A commonly asked question by landlords is around passing on the water usage charges to their tenants. In NSW, state laws determine who is responsible for paying for the water usage at a property.
There are several measures to meet to be able to pass on the water usage charges to your tenant and are defined in both section 3 (definitions) and section 39 of the Residential Tenancy Act. Under section 39 of the Act, landlords can only ask a tenant to pay water usage charges if:
- The property is separately metered (or water is delivered by vehicle, such as those with water tanks on rural properties).
- The property meets the prescribed water efficiency measures (as outlined in clause 10 of the regulation).
- The charges passed on are not more than the amount the landlord has been billed by the supplier.
The definition of 'separately metered' under section 3 gives further clarity as to these circumstances. For water usage charges, a rental property is considered to be separately metered if the water meter:
- Has been appropriately installed at the property.
- Measures the amount of water supplied or used only at the property.
- Allows a separate bill to be issued by the supplier for all charges for the supply and use of the utility or water at the property.
Landlords cannot pass on water usage charges if the meter installed on the property does not meet these criteria. For example, suppose there is no separate water meter for the rented property (as is the case with blocks of units or granny flats that use a small gauge or 'clicker' at some point along the water delivery system). In that case, a tenant cannot be charged for water usage. Such 'flow meters' are not read by a water supply authority simultaneously as a revenue meter for which a bill is issued, introducing the potential for tenants to be inaccurately charged. The definition of 'separately metered' was introduced to ensure that the tenant will only pay for the water they have used. The water usage is measured in a clear, consistent and reliable way.
Water usage charges should also be charged paid and separately to rent. An invoice must be issued to the tenant, allowing them 21 days to pay the account.
There is more information on charging tenants for water usage and utilities in general, available on the Fair Trading website: https://www.fairtrading.nsw.gov.au/housing-and-property/renting/during-a-tenancy/Water,-electricity-and-gas-in-rental-properties
If you'd like to experience the difference a dedicated Newcastle property manager can make in ensuring you are maximising your return and meeting current legislation, contact us via casey@c21newcastle.com.au or 02 4928 7400 today.