An overview of what levies and contributions may be payable when building in NSW
When building in New South Wales (NSW), several levies and contributions may be payable to local councils, state agencies, or other authorities. These payments are designed to fund infrastructure and community services. Here's an overview of the main levies and contributions you might encounter:
1. Developer Contributions (Section 7.11 and 7.12 Contributions)
Formerly known as: Section 94 and Section 94A Contributions
Section 7.11 Contributions: Applied when a development creates an increased demand for public infrastructure, such as roads, parks, or community facilities. Contributions are calculated based on the specific infrastructure demands of the development.
Section 7.12 Contributions: A flat levy based on a percentage of the estimated cost of development. Often used for smaller developments. The percentage typically ranges from 0.5% to 3%, depending on the value of the project and the local council’s contribution plan.
2. Special Infrastructure Contributions (SICs)
Payable for developments in specific growth areas, such as Western Sydney, Hunter, or Illawarra.
These contributions fund regional infrastructure, including roads, public transport, schools, and health facilities.
Rates vary by location and development type.
3. Long Service Levy
A levy for construction projects costing $250,000 or more.
The current rate is 0.35% of the estimated cost of building works.
Payable to the Long Service Corporation to fund the long service leave scheme for workers in the construction industry.
4. Bonds and Security Deposits
Some councils require bonds or security deposits to ensure compliance with conditions, such as maintaining public property or completing landscaping. These are refundable upon satisfactory completion of the project.
5. BASIX (Building Sustainability Index) Certificate Fees
A fee for lodging the BASIX certificate, which ensures that new homes or major renovations meet energy and water efficiency standards.
The cost depends on the type of development.
6. Affordable Housing Contributions
Required in some areas as part of a council's affordable housing strategy.
The contribution may be monetary or in-kind (e.g., provision of affordable housing units).
7. Fire and Emergency Services Levy
Incorporated into your council rates and paid annually. This levy funds fire and emergency services.
8. State Infrastructure Charges
Applies in areas under state development control (e.g., Sydney’s Barangaroo or Green Square precincts). Rates vary based on the development and its location.
9. Voluntary Planning Agreements (VPAs)
Agreements negotiated with councils or state agencies where developers provide contributions beyond standard levies, such as additional infrastructure or community benefits.
10. Other Local Contributions
Stormwater Management Charges: Applicable for developments that require stormwater systems.
Road Damage Contributions: For heavy vehicle traffic associated with construction.
Waste Management Levies: May apply to cover increased waste collection and disposal costs.
How to Determine Applicable Levies
Check your local council’s Development Contributions Plan or speak with a council planner.
Review state-specific requirements if your site falls under a regional or state-significant development area.
Engage a planning consultant or approval service (such as Dynamic Approvals) for detailed advice tailored to your project.