Whether you newly bought a condominium or have owned one for years, you have

probably accepted the monthly condominium association dues at face value. But did
you ever take the time to really understand what condominium association dues are
and why you have to pay them? Fortunately, we can help as we shed light on this
matter.

A CONDOMINIUM ASSOCIATION DUE IS

PAYMENT DUE EACH MONTH FOR EXPENSES
RELATING TO MAINTENANCE AND
COMMUNITY OPERATIONS AND IS
COLLECTED BY THE PROPERTY
MANAGEMENT OFFICE. THE FEE CHARGED
BY THE ASSOCIATION IS USED TO FUND
MAINTENANCE AND IMPROVEMENTS FOR
PROPERTY UNDER THEIR JURISDICTION.
THESE FUNDS WILL BE TAKEN OUT FROM
THE ASSOCIATION DUES THAT YOU HAVE
PAID FOR.
Make sure you know exactly what youre getting into before you purchase a property subject to
condominium rules and dues. Source: jrtampalaw.com
Since youre paying with your hard earned money, its best that you get your facts
straight.

Weve compiled a list of Facts and Fallacies regarding

condominium association dues and everything in
between.

1. THE CLAIM: The condominium has the power to cut off or

deny basic utilities as well as the use of common
amenities due to non-payment of association dues.

Fact or Fallacy: FACT

Failure to pay monthly dues may result to account delinquency and therefore you can
be stripped of the right to use basic utilities and amenities of the condominium such as
the swimming pool, function area or gym.

2. THE CLAIM: The condominium association dues are fixed.

Fact or Fallacy: FALLACY

Depending on the operating expenses of the building, the cost of association dues vary
in every project. If the building offers more amenities, then it is likely more expensive.
The computation is based on the size (total area in square meters) of your unit,
including the parking space or balcony, if you have one.

3. THE CLAIM: The condominium association has the right

to hand out penalties.

Fact or Fallacy: FACT

Failure to pay dues on time can lead to a penalty of 3 or 4% interest charge. When it
comes to violating rules and regulations, you can either receive a warning or a hefty
fine. Always assume that penalties will be enforced, though you might want to talk to a
few people already living in the community to get their input on how the association
handles violations.

4. THE CLAIM: Condominium association dues are subject to

tax.

Fact or Fallacy: FALLACY

The Court of Tax Appeals (CTA) has ruled that condominium or association dues as well
as other fees collected from unit owners are not subject to income tax and withholding
tax. This was premised on the theory that the money collected was merely held in trust
to be used for administrative expenses incurred in servicing members and does not
constitute any sale of goods or rendition of service.
 5. THE CLAIM: Condominium association dues cover
insurance.

Fact or Fallacy: FALLACY

Condominium fees generally do not cover insurance for individually owned units.
Instead each unit owner is responsible for securing adequate property and liability
insurance.

6. THE CLAIM: Low condominium association dues is a bad

sign for condominium buyers.

Fact or Fallacy: FACT

Prior to buying a condominium unit, it is important to investigate the developments

condominium fee history. If the fees seem too low, the development could be in
disrepair, or it might not have enough reserves to handle unexpected maintenance
expenses. Fees could also be low to entice buyers while the developers sell all of the
units. Once the property is turned over to the condominium association, however, the
fees could increase significantly.

7. THE CLAIM: I can opt not to join the condominium

association so as not to pay the monthly association
dues.

Fact or Fallacy: FALLACY

Upon purchase of a condominium, you are obligated to join that condominium

association and pay monthly or annual association fees for the upkeep of common
areas and the building.

8. THE CLAIM: I can choose not to follow condominium

rules and policies since I pay my dues on time.
Fact or Fallacy: FALLACY

No one is exempted; even the President of the condominium association must follow
all the rules and policies regardless of on time payment of dues. Every association has
their own set of rules and level of strictness regarding enforcement.

9. THE CLAIM: Only the Board of Directors is responsible in

managing the affairs of the association.

Fact or Fallacy: FACT

Or sometimes called Trustees, manage the affairs of the association such as expenses,
repair concerns and even neighbor disputes.

10. THE CLAIM: As a member of the condominium association, I

am required to attend association meetings.

Fact or Fallacy: FACT

Typically, condominium associations hold regular meetings with their members to keep
things running smoothly. Because these associations govern the rules, regulations, and
maintenance of housing developments and complexes, these meetings are necessary
and important. Common concerns include budget, repairs, election and complaints.
You are therefore encouraged to be present during these meetings to participate, vote
and be eligible for any elective or appointive office of the association subject to the
qualifications as provided for in the bylaws.

11. THE CLAIM: It is restricted to view financial records and

other documents of the condominium association.

Fact or Fallacy: FALLACY

All records involving the affairs of the association shall be available for examination by
all owners, holders of mortgages on the lots, and their respective authorized agents
upon reasonable advanced notice, during normal working hours at the office of the
association.

12. THE CLAIM: My status as a member of the condominium

association can still be reinstated even after being tagged as
delinquent.

Fact or Fallacy: FACT

A member who has failed to pay three (3) cumulative monthly dues or membership
fees, or other charges despite demands by the association, or has repeatedly violated
the associations by-laws and/or declared policies, may be declared delinquent by the
Board of Directors.

The President or the designated officer of the association shall notify the said member
in writing of the violation and require a written explanation, within fifteen (15) days
from receipt of notice, why he should not be declared delinquent.

If the member is found delinquent after a Board hearing, the Board also has the power
by majority vote of all members, to reinstate the membership of the delinquent
member, provided that unpaid dues, fees or charges are paid or the sanctions imposed
are satisfied.

Condominium associations can be your best friend when they uphold a good
management of the entire condominium, but your worst enemy when they expect you
to perform expensive maintenance on your home that you dont think is necessary, or
impose rules that you find too restrictive. But keep in mind that diligent payment of
dues is your way of keeping your home and the whole condominium in peak condition.