Penalty for Not Contributing to Common Expenses: 5% Late Payment Penalty

A unit owner who does not pay their dues on time faces not only the debt itself but also a late payment penalty. This is an important sanction introduced by the law to encourage payment and preserve order. In this guide we explain the 5% late payment penalty imposed as a consequence of not contributing to common expenses, how it works and whether it can be changed, under Article 20 of the Condominium Ownership Law No. 634 (KMK).

What is a late payment penalty?

The late payment penalty is the additional amount that a unit owner who does not pay their expense or advance share on time must pay for the delay. In the clear wording of the law: A unit owner who does not pay all of their expense and advance share is obliged to pay a late payment penalty at the rate of five per cent (5%) per month for the days delayed (KMK Art. 20). This shows that delaying payment has a direct cost.

Can the 5% rate be changed?

This is a very important and frequently asked topic. The 5% monthly rate is fixed by law and, as a rule, cannot be changed. It cannot be reduced below this rate or arbitrarily increased through the management plan or a decision of the assembly of unit owners. A management cannot say "let's make the late payment penalty 10%" or "let's not apply it at all" and change the statutory rate. This fixed nature ensures a foreseeable and fair application for all unit owners.

How is the late payment penalty calculated?

The penalty is calculated at 5% per month on the unpaid amount, in proportion to the period delayed. For example, if a given dues debt is paid one month late, approximately 5% penalty accrues over that debt; as the delay lengthens, the penalty grows. For the calculation to be correct, the amount and the payment date (due date) of the debt must be clear. It is therefore important for the debt to be notified to the owner or otherwise known.

When does the penalty start?

For the late payment penalty to run, the amount to be paid and the payment date must be known to the unit owner or notified to them. When the due date set by the operating budget or the decision of the assembly of unit owners arrives, the penalty starts to run if payment is not made. It is therefore important, as a basis for the penalty claim, that dues accruals and due dates be regularly notified.

Does the penalty apply even if dues are not used?

Yes. The unit being empty or the services not being used does not remove the obligation to pay dues. Therefore, in such cases too, if payment is delayed, the late payment penalty applies. The law considers it sufficient to have the right to benefit from the service; actual use does not affect the debt.

The penalty together with enforcement and litigation

The late payment penalty is not a sanction on its own. If payment is not made, the manager or any of the other owners can initiate enforcement proceedings or file suit against the debtor owner (KMK Art. 20). In these proceedings, the operating budget or the assembly decision can be used as an important document. It is even possible to place a statutory mortgage on the independent unit for the debt.

Summary

A unit owner who does not contribute to the common expense or advance pays a 5% monthly late payment penalty for the days delayed. This rate is fixed by law and cannot be changed by the management plan. For the penalty to run, the debt and the due date must be known. If payment is not made, enforcement, litigation and statutory mortgage may come onto the agenda.

Calculating the late payment penalty manually carries the risk of error and takes time. Apt Yönet automatically calculates the late payment penalty for overdue debts, offering the management accurate and transparent collection.

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Frequently Asked Questions

Is there a penalty when dues are paid late?

Yes. A 5% monthly late payment penalty is applied for the days delayed (KMK Art. 20).

Can the late payment penalty rate be raised?

No. The 5% monthly rate is fixed by law and cannot be changed by the management plan or an assembly decision.

When does the penalty start to run?

The penalty starts to run when the amount to be paid and the due date are known to the owner and payment is not made.

Is there a late payment penalty on an empty unit?

Yes. Even if the unit is empty, dues are paid; if paid late, a late payment penalty also applies.

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This content is for general information only and does not constitute legal advice. You are advised to consult a legal expert about your specific situation.