Can't pay your strata levies? The 27 October 2025 hardship rules and how to force a payment plan
From 27 October 2025, NSW strata law gives lot owners in financial hardship real procedural rights — and gives owners corporations real obligations to consider a payment plan on the merits. The reforms (under the Strata Schemes Legislation Amendment Act 2025) introduce mandatory hardship information on every levy notice, a prescribed request form, a duty to consider, a 28-day response window, written reasons for any refusal and a freeze on debt recovery while a compliant plan is on foot.
This page is the post-27-October-2025 playbook. How to make the request, what the owners corporation must consider, what a valid refusal looks like, NCAT review, and how it connects to NSW Fair Trading's new strata investigative powers under the same reform package.
Important: the reform commenced on 27 October 2025 and the prescribed forms are administered by NSW Fair Trading. Verify the current Form 1 and the precise statutory sections on nsw.gov.au/strata before lodging.
Information, not legal advice. Figures current as at 27 October 2025.
What this dispute is
The 27 October 2025 strata reforms rebuilt how owners corporations recover overdue levies and how lot owners in financial difficulty are treated. Before the reform, an owner who couldn't pay was largely at the mercy of the strata committee's discretion. After the reform, the law sets the process: information on every notice, a prescribed request, a mandatory consideration step, written reasons, and a stay on recovery while the plan is being honoured.
The hardship request is made on Form 1 — Request for a Payment Plan for Overdue Contributions (the prescribed form). The owners corporation must consider each request on its merits — it cannot rely on a standing resolution that says "no payment plans, ever". It must respond in writing within 28 days. If it refuses, the response must give written reasons. The maximum plan period is 12 months, and a new plan can be entered after an existing plan ends.
While a compliant payment plan is on foot, the owners corporation cannot start debt-recovery proceedings against the owner. Before starting recovery proceedings at all, the owners corporation must give the owner 30 days' notice of the intention to commence. Repayments under a plan are generally applied first to the overdue levies themselves, then to interest, then to recovery costs — protecting the owner from being indefinitely behind on principal.
If the owners corporation refuses (or imposes terms that aren't workable), the owner can apply to NCAT for review. NCAT can order the owners corporation to enter a payment plan on terms the Tribunal sets. Separately, NSW Fair Trading now has expanded powers — under the same reform package — to investigate strata schemes, require documents, enter premises and seek compliance orders or compulsory managing-agent appointments at NCAT.
Time limits that bite
These deadlines are strict. The Tribunal can extend in some cases, but extensions are not automatic — they're weighed on length, reason, prospects and prejudice.
- 28 daysOwners corporation must respond in writing to a Form 1 payment-plan requestSSMA 2015 (as amended 2025)
- 30 daysNotice the owners corporation must give before commencing debt-recovery proceedingsSSMA 2015 (as amended 2025)
- Up to 12 monthsMaximum length of a single payment plan — renewable after the prior plan endsSSMA + Regulation
- While plan is on footOwners corporation cannot commence recovery proceedings while the owner is complying with a payment planSSMA (amended)
- No statutory deadlineNo fixed period to apply to NCAT for review of a refusal — apply promptly to avoid further recovery costs accruingNCAT Guideline
The process, step by step
- 1
Read the levy notice — the hardship statement is on it
Every levy notice issued on or after 27 October 2025 must carry the Fair Trading Financial Hardship Information Statement. It explains your right to ask for a payment plan, points to the prescribed form, and sets out the owners corporation's response duties. If your levy notice doesn't include the statement, the notice is non-compliant and you should raise that with the strata manager before doing anything else.
Don't ignore the notice. Engagement matters — the law expects you to act promptly. If you can't pay the full amount, send the Form 1 request before the due date or as soon as possible after.
- 2
Complete Form 1 — Request for a Payment Plan
Form 1 is the prescribed request form. Get the current version from nsw.gov.au/strata. You'll be asked to identify the lot, the overdue contributions, the period over which you propose to pay, the instalment amount, and your circumstances of hardship.
The hardship part is where this case is won or lost. Attach: payslips or Centrelink statements for the last three pay cycles; bank statements showing balances; a short personal statement explaining the trigger (job loss, medical, separation, business downturn); medical letters where relevant. Be specific about how long you expect the hardship to last and why the proposed plan is genuinely affordable.
- 3
Serve the request on the owners corporation
Send Form 1 to the strata manager (if appointed) or to the secretary of the strata committee at the address for the owners corporation. Use email plus a tracked-post backup so you have clear proof of service. The 28-day clock runs from when the request is received.
Mark day 29 in your calendar. If you've had no written response by then, follow up in writing and treat the silence as a constructive refusal for the purpose of applying to NCAT.
- 4
If you get a refusal — test the reasons
A valid refusal must (a) be in writing, (b) be the result of an actual consideration of your request on its merits, not a blanket policy, and (c) give written reasons. Blanket refusals ("the owners corporation does not enter payment plans") are unlawful under the post-27-October-2025 regime. Reasons that don't engage with your evidence (e.g. "request denied" with no analysis) are likely challengeable.
Reply in writing: identify the deficiency, ask the committee to reconsider on the merits, and put them on notice that you will apply to NCAT if no compliant decision follows within 14 days. Many refusals reverse at this stage once the committee understands the procedural obligations.
- 5
Lodge the NCAT application
Apply to NCAT's Consumer and Commercial Division for an order under the Strata Schemes Management Act 2015 (as amended). The order to seek: "An order under the SSMA 2015 that the owners corporation enter a payment plan with the applicant on the terms set out at Annexure A, in substitution for the plan refused on [date]."
Bring: the levy notice with hardship statement; the Form 1 request and proof of service; the refusal (or evidence of no response); your hardship evidence (payslips, Centrelink, bank statements, medical); the proposed plan terms. NCAT can mediate the application before hearing — many resolve there.
- 6
If Fair Trading needs to get involved
Under the same 27 October 2025 reforms, NSW Fair Trading has expanded investigative and enforcement powers in strata. Fair Trading can require documents, enter premises, issue compliance notices and apply to NCAT for orders — up to and including the compulsory appointment of a managing agent. Where a scheme is systematically refusing payment plans or failing to include the hardship statement, complain to Fair Trading in parallel with your NCAT application.
Verify the current Fair Trading complaint route on nsw.gov.au/fair-trading before relying on the regulator — their strata function is operated by the dedicated Strata and Property Services Taskforce within Fair Trading.
Evidence that actually works
Cases are lost on missing documents more than on weak arguments. Get these in order before you file.
Levy notice(s) — including the Financial Hardship Information Statement
Establishes the debt and shows whether the OC has complied with the post-27-October-2025 disclosure requirement.
Completed Form 1 — Request for a Payment Plan
The prescribed request form, fully completed with your proposed plan terms.
Proof of service of Form 1
Email delivery receipt, postal tracking, or written acknowledgement. Anchors the 28-day clock.
Refusal letter (or evidence of no response by day 29)
The text of any refusal — useful for testing whether it engages with your circumstances on the merits.
Income evidence — payslips, Centrelink statements (last 3 cycles)
Shows what's coming in. Match it to the proposed instalment.
Bank statements (last 3 months)
Shows liquidity. Helps establish what you can realistically pay each month without falling further behind.
Hardship trigger documents
Job-loss letter, medical letters, separation documents, business closure notice — whatever caused the hardship.
Strata roll, by-laws, and committee meeting minutes (if available)
Useful to show whether the OC has a standing 'no payment plans' resolution — which would be unlawful.
Common reasons people lose
Ignoring the levy notice and waiting for recovery
Engagement matters. The protections apply when you've requested a plan. Ignoring the notice and arguing hardship after recovery has started is much harder.
Not using Form 1
A casual email request doesn't trigger the prescribed procedure. Use Form 1 so the statutory clock and obligations engage cleanly.
Vague hardship evidence
Saying 'I'm struggling' without payslips and bank statements gives the committee an easy refusal. Document the trigger and the affordability calculation.
Proposing a plan you can't keep
Defaulting on the plan removes the no-recovery protection and weakens any future request. Propose a payment you can sustain.
Treating the 30-day pre-recovery notice as the 28-day response window
Two different clocks. The 28 days is the OC's response window after your Form 1. The 30 days is the OC's notice before starting recovery. Don't conflate.
Skipping NCAT and going straight to Fair Trading
Fair Trading investigates compliance — but NCAT is what compels a payment plan. Run them in parallel, with NCAT as the primary route.
Orders NCAT can make
This is the kind of order you can ask for — not a guarantee you'll get it. Frame your application around the order you actually want.
Order that the owners corporation enter a payment plan
An NCAT order under the SSMA 2015 directing the OC to enter a payment plan on terms specified by the Tribunal — typically up to 12 months.
Order suspending or restraining recovery proceedings
Where the OC has started recovery in breach of the no-recovery-while-plan rule (or before serving the 30-day notice), an order halting those proceedings.
Order varying interest or recovery costs
Where charged inconsistently with the SSMA's order-of-application rules (overdue levies first, then interest, then costs).
Declaration that a refusal is invalid
A declaration that a blanket refusal or a refusal without merits-based reasons does not comply with the SSMA — and an order remitting the request for proper consideration.
Compulsory appointment of a strata managing agent
Available at the regulator's instance under Fair Trading's expanded post-27-October-2025 powers where a scheme is systematically non-compliant.
Free help
- NSW Fair Trading — Strata (levies)
Government portal — current Form 1 and the hardship information statement.
- NSW Government — strata law changes
Reform timeline including the 27 October 2025 commencement.
- Marrickville Legal Centre — strata hardship plain-English
Community legal centre explainer for owners.
- NCAT — apply online (strata)
Lodge your strata application via NCAT Online.
- Strata Schemes Management Act 2015 (NSW)
The legislation — debt recovery and hardship provisions as amended.
- LawAccess NSW — 1300 888 529
Free legal info line, Mon-Fri 9am-5pm.
Questions self-reps ask
Does the owners corporation have to give me a payment plan?
Not automatically — but the owners corporation has to consider your Form 1 request on the merits, respond in writing within 28 days, and give reasons if it refuses.
A blanket "no payment plans" resolution is not lawful under the post-27-October-2025 regime. If the request is refused without merits-based reasons, you can apply to NCAT for an order that the OC enter a plan on terms the Tribunal sets.
Can the owners corporation start debt recovery while I'm asking for a plan?
It has to give 30 days' written notice before commencing recovery proceedings. If a compliant payment plan is on foot, it cannot commence recovery.
If you've made a Form 1 request and are waiting on a response, the practical answer is also no — starting recovery in those circumstances would be hard to justify and weakens the OC's position in any later dispute.
How long can a payment plan run?
A single payment plan can run for up to 12 months. After it ends, a new plan can be entered for any continuing or new overdue contributions.
The owners corporation cannot charge a fee for considering or entering a plan.
How are my repayments applied — to interest or to the principal?
The SSMA (as amended in 2025) sets the order of application: overdue contributions first, then interest, then recovery costs.
That protects you from a situation where your payments all go to interest and never reduce the underlying debt.
What if the strata manager just ignores my request?
If you have no response by day 29, treat the silence as a constructive refusal and apply to NCAT. Bring your proof of service of the Form 1 to anchor the date.
Separately, complain to NSW Fair Trading — under the same 27 October 2025 reform package the regulator has expanded powers to investigate non-compliant schemes, require documents and seek compliance orders or compulsory managing-agent appointments at NCAT.
Can the owners corporation impose conditions on a payment plan?
Yes, within reason. Conditions like an upfront good-faith payment, automatic direct debit, or surcharge of reasonable interest are common.
Conditions that defeat the purpose of the plan (e.g. one missed payment immediately triggers full debt and recovery) are likely to be unreasonable. If the conditions make the plan unworkable, raise that in your NCAT application and ask the Tribunal to set the terms.
I'm a tenant in the building — do these rules help me?
No — these rules are for lot owners (the people who own a unit in the strata scheme). If you're a tenant, levies are paid by your landlord.
If you're struggling with rent, see our tenancy guides on excessive rent increases and ending a tenancy on hardship grounds.
Related guides
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NCAT Tracker is not a law firm. This page is information, not legal advice. Figures, fees and statutory periods cited here are current as at 27 October 2025 and are CPI-indexed or amended from time to time — verify on ncat.nsw.gov.au and legislation.nsw.gov.au before you lodge.