Managing retirement village resident fees, charges and village funds

This information helps operators understand their responsibilities for calculating, managing and communicating fees and charges for retirement village residents.

Recurrent charges

Recurrent charges are the regular fees a resident pays to help cover the ongoing costs of running the retirement village. These must be specified in the residence contract.

An operator can only increase recurrent charges by:

• by the amount or formula set out in the residence contract, or
• by the Consumer Price Index (CPI)

unless

• most residents agree to a greater increase, or
• the increase is ordered by the South Australian Civil and Administrative Tribunal (SACAT).

Some costs are excluded from these limits. These include:

• council rates, taxes and other charges set by law
• wages and salaries covered by awards
• prescribed maintenance contracts, for example
  • Security infrastructure and systems
  • Lift infrastructure and systems
  • Waste management infrastructure and systems
• utilities and insurance

Before increasing recurrent charges for prescribed maintenance services, an operator must consider whether a more cost-effective alternative exists.

When a resident leaves a retirement village, the operator must pay any ongoing charges for the vacated residence. This includes recurrent charges and other relevant charges such as council rates, water rates, and the emergency services levy (where these are not covered by the contract).

If the resident is getting an exit payment, the operator can recover those charges from that payment.

There are some limits:

• the operator cannot recover the charges from the resident until the exit payment is due, and then they can deduct the charges from the exit payment
• the amount the operator can recover cannot be more than the exit payment
• the operator can only claim charges for a certain period:
  • until the residence is sold, relicensed, or occupied by someone else, or
  • 6 months from when the resident left, whichever comes first.

You can ask the South Australian Civil and Administrative Tribunal (the Tribunal) to extend this period if it is unfair to limit it to six months.

Applications can be made online at www.sacat.sa.gov.au.

Capital funds

Capital funds are money set aside to pay for major items and long-term upkeep in a retirement village. This can include things like replacing appliances, maintaining communal areas, and carrying out planned improvements.

Operators must:

• explain how capital funds are funded and managed in the residence contract and disclosure statement
• separately report on capital fund income and expenditure as part of the annual financial reporting to residents
• use the funds for their intended purpose, such as replacing large items and covering long-term maintenance.

Capital replacement fund

The capital replacement fund is used to replace major items like carpets, stoves, hot water units, and air conditioners or improvements.

Long-term maintenance fund

A long-term maintenance fund (also known as sinking fund) covers unexpected or unplanned repairs and maintenance, such as fixing roads, drains, or painting communal areas.

Special levies

A special levy is an extra fee a retirement village resident may need to pay when there is an unexpected cost that the regular funds (like recurrent charges or sinking funds) cannot cover. For example, a village might need a special levy to pay for unexpected road repairs caused by tree roots.

An operator must:

• explain in the residence contract and disclosure statement that a special levy can be charged for unexpected costs
• include in the residence contract any special levy that is in place in the village, its purpose and the amount and frequency of payment
• arrange a residents’ meeting for any proposed special levy, including giving at least 15 business days’ notice and providing meeting materials
• make sure residents vote on the proposal, and only charge the levy if at least 75% of residents who vote at the meeting support it
• use the money raised only for the purpose agreed by residents.

When can a special levy be charged

A special levy can only be charged if residents agree through a special resolution at a meeting. Two conditions must be met:

• residents receive at least 15 business days’ written notice of the meeting and the proposed levy
• at least 75% of residents who vote at the meeting (one vote per residence) are in favour. Voting can be in person or by absentee vote.

Taxes and fees that cannot be charged to residents

The Retirement Villages Act states that residents are not liable to pay the following costs:

• costs relating to the depreciation, amortisation or writing-off of assets of the retirement village.
• costs incurred by the operator in obtaining legal advice or undertaking legal proceedings relating to the retirement village.
• fines or other penalties incurred by the operator.
• fees, charges or other monetary amounts payable by the operator in respect of newly constructed residences in a retirement village that are not yet subject to a residence contract
• a remarketing fee or charge that is not specified in, or calculated in accordance with, residence contract (for contracts from 2 February 2026) or does not represent the reasonable costs incurred by the operator (where the contract was entered into before 2 February 2026 and does not specify the fee or charge).

An operator must not attempt to recover these costs by increasing recurrent charges.

Related information

On this site

Financial reporting and consultation

Other websites

• Retirement Village Registrar - Office for Ageing Well
• South Australian Civil and Administrative Tribunal (the Tribunal)

Legislation

• Retirement Villages Act 2016
• Retirement Villages Regulations 2017