Funding remediation levies in 2026

The remediation tailwind — what is actually happening

Ireland's apartment building stock contains a significant number of units affected by fire-safety defects, structural deficiencies, and inadequate water ingress protection — issues concentrated in blocks built during the construction boom of roughly 1994 to 2014. The scale of the problem has been estimated in the hundreds of thousands of units, and the State's response — a funded remediation scheme administered through Housing for All and subsequent legislation — is now in active delivery across the country.

For managing agents, the practical effect is that OMCs which have been accepted into the scheme, or which are proceeding with remediation outside it, are facing levy demands that can run from tens of thousands to several million euro per development. These costs arrive on top of — not instead of — the annual service charge and sinking fund contribution. For many owners, particularly those who bought at peak prices and are now facing a large unexpected bill on a property whose value has only recently recovered, it is a genuine financial shock.

The State scheme provides grant funding that covers a significant portion of eligible costs, but grant payments typically lag the actual remediation expenditure by months, and not all costs within a scheme will qualify. OMCs and their agents therefore face a period of bridging the gap between when the money must be spent and when the grant lands. Levy billing is how that gap is funded at the member level.

A levy is not a service charge — and the distinction matters

The annual service charge covers the recurring costs of operating and maintaining a multi-unit development: insurance, cleaning, lift maintenance, fire-alarm servicing, management fees, and the sinking fund contribution. It is budgeted annually, approved by the members or directors, and demanded as a recurring obligation under each owner's lease or title documents.

A remediation levy is different in almost every dimension. It funds a specific, defined capital liability — the cost of identified defect rectification works — rather than operational running costs. It is typically raised once (or in tranches as works progress) rather than annually. The legal basis for demanding it, and the accounting treatment, differ from the service charge. And unlike the sinking fund contribution, the money should be visible in a dedicated account from the moment the first payment lands: mixed with operating income, it becomes very difficult to reconcile with grant receipts, contractor invoices, and the eventual close-out accounts.

From a practical perspective, this means the levy must be demanded separately — not bundled into the service-charge invoice as a line item — with its own:

• Dedicated bank account (segregated from the OMC's operating account and sinking fund)
• Separate accounting code so that every payment in and every contractor payment out can be tracked independently
• Named purpose in all member communications — "Riverwood Hall Fire Safety Remediation Levy 2026" rather than a generic charge
• Distinct payment reference on bank transfers so that reconciliation is unambiguous

This separation is not bureaucratic tidiness. When the grant auditor arrives — and on scheme-funded projects they will — a clean paper trail between member contributions and expenditure is what keeps the OMC's claim intact. An accountant who has to untangle a remediation levy from two years of mixed service-charge income will charge accordingly, and may not be able to give you the clean certification the grant authority requires.

Apportionment — billing each unit fairly

Most OMC leases define an apportionment schedule that governs how shared costs are divided between units. The schedule may be based on floor area, a fixed equal share, or a hybrid formula that reflects different unit sizes or different levels of benefit from common services. The same schedule that governs the annual service charge will almost certainly govern the remediation levy — unless the works benefit only a subset of units, in which case a modified schedule may be appropriate.

This is worth reviewing carefully before the first levy demand is issued. A development with a mix of apartments and commercial units, or a phased development with multiple blocks under the same OMC, may have a complex apportionment structure. Applying a single percentage to all units when some units have no relationship to the defective element (a fire-safety issue in Block A that does not affect Block B, for example) is the kind of administrative shortcut that generates disputes and, in a worst case, a challenge in the Circuit Court.

Whatever apportionment basis is used, it must be shown in the levy notice to members. Not just the total levy and each unit's share — the calculation. A member who receives a demand for €4,200 and cannot see how that number was arrived at is a member who will dispute it. A member who receives the same demand alongside a table showing total levy cost, their apportionment percentage, and the arithmetic is a member who may still object but cannot credibly claim they were not informed.

The communication challenge — explaining a large unexpected bill

There is no way to make a demand for several thousand euros pleasant, but there is a significant difference between a communication that creates fear and resentment and one that creates understanding and, ultimately, co-operation.

The fundamental problem with most levy communications is that they are written by people who already know the full story — the legal framework, the defect history, the contractor selection process, the grant application — addressing people who know almost none of it. The notice that makes sense to the managing agent or the director is often opaque to the owner who has not been following the process and is seeing the word "remediation" for the first time on an invoice they did not expect.

A plain-English levy communication should address, in order:

1. What has been found. A one-paragraph summary of the defect — what it is, where it affects the building, and why it needs to be rectified now. Use the survey report's findings but translate them out of technical language. "The fire-stopping between floors in the east stairwell is incomplete and does not meet current standards" is better than "inadequate passive fire protection elements as per BS 9999."
2. What will be done, and by whom. The name of the contractor, the scope of works in plain terms, the expected start and completion dates if known.
3. What it costs in total, and why the levy is this amount. The total contract value, any grant funding expected, and the net amount being recovered from members. Show the arithmetic. If the levy is being raised in tranches, explain the tranche structure.
4. The legal basis for the demand. A brief reference to the relevant provision in the OMC's memorandum and articles or the members' leases. Owners have a right to know on what authority they are being asked to pay.
5. How and when to pay — including the instalment option. Every available payment method, the due date, and a clear, prominently signposted route to a self-serve instalment plan for members who cannot pay in full immediately.
6. What happens if they have questions or concerns. A contact point and a brief note on the dispute process. Members who feel there is a way to raise a concern are less likely to simply ignore the demand.

An AGM or special general meeting notice before the levy is issued is the ideal context for covering the first three points — it gives members a chance to ask questions, and the minutes of that meeting become part of the evidence trail. If the timetable does not allow for an SGM, a well-structured circular with an online Q&A or written-questions process is a reasonable alternative.

Dealing with hardship — instalment plans and what they protect

A large one-off levy will exceed the short-term cashflow capacity of a portion of the membership, regardless of the development. Non- resident landlords with overextended mortgage portfolios, retired owner-occupiers on fixed incomes, owners in the middle of a sale or separation — there are always legitimate reasons why full payment within thirty days is not possible.

A well-designed instalment plan is not a concession — it is a collection mechanism that recovers the money in full while reducing the default rate. An owner who can spread a €4,200 levy over twelve monthly payments of €350 will almost certainly pay in full. An owner who cannot access that option may simply not engage, and the OMC's alternatives at that point become increasingly expensive.

For a remediation levy, the instalment structure needs more thought than a standard service-charge plan:

• The term should reflect the levy size. A six-month plan suits an €800 levy; it may not suit a €5,000 levy. Twelve or eighteen months is defensible for larger demands, particularly for an OMC's first experience of major levy billing.
• The plan should be secured by direct debit. A member who commits to an instalment plan by BACS or card is giving you a promise; a member on direct debit is giving you a mechanism. The difference in completion rates is substantial.
• The plan must not compromise the OMC's ability to pay contractors. If you offer twelve-month plans but your contractor requires payment within ninety days of practical completion, you need a bridging facility — often the sinking fund, subject to the constraints in the next section. Confirm the payment schedule with your contractor before setting plan terms.
• Hardship cases need a human in the loop. Automated plans work for the majority; for an owner who cannot meet even a modest monthly payment, the case needs individual attention and, where appropriate, a board decision on a longer deferral or reduced plan.

Keeping an evidence trail — what you need and why

An OMC that bills a remediation levy without a robust evidence trail is creating a problem it may not discover for two or three years — usually when a member disputes the charge on a sale, when a grant auditor requests documentation, or when a director faces a challenge at an AGM from a member who claims they were never properly informed.

Evidence requirements fall into two categories:

Decision evidence covers the governance process that authorised the levy: the survey report, the board minutes approving the works and the levy amount, any SGM notice and proxy pack, the vote result and the record of who voted, and the legal advice obtained (if any) on the basis for demanding the levy under the OMC's constitution.

Communication evidence covers what was sent to each member, when it was sent, and whether it was delivered. This means retaining not just the text of each levy demand and instalment plan communication, but the delivery record — email delivery receipts, read receipts where available, postal evidence for members without email addresses on file. Each communication should be timestamped and tied to the specific version of the levy notice issued at that time (if the levy is raised in tranches, version control matters).

For the purposes of a member challenge or a PSRA complaint, the most important document is the first communication: the notice explaining what the defect is, what the works will cost, and what each member's share is. If that notice was properly served on every member at a given date and the member's response (or silence) is logged, the OMC's position in any subsequent dispute is much stronger than if the communication record is incomplete or ambiguous.

Additionally, under GDPR, communications relating to members' levy positions — how much each member owes, whether they are in a plan, whether they are in arrears — are personal data and must be handled accordingly. Aggregate information (the development's total levy collection rate) can be shared at an AGM; individual account details cannot. See our guide to managing service-charge arrears for more on GDPR obligations in a collections context.

Interaction with the sinking fund

The sinking fund is the OMC's ring-fenced capital reserve, built up over years of annual contributions and intended to fund predictable large expenditure — roofs, lifts, facade work. As we explore in detail in our guide to sinking funds, it must be held separately from operating income and can only be drawn on for capital purposes.

The interaction with a remediation levy is nuanced:

• The sinking fund can absorb part of the levy burden. If the remediation works fall within the categories the fund was established to cover — structural defects, fire safety systems, major building elements — the directors may resolve to apply part of the sinking fund balance towards the cost, reducing the net amount that needs to be raised from members via a levy. This is a legitimate use of the fund if the governing documents permit it, but it should be documented as a board resolution and disclosed to members.
• The sinking fund can bridge timing gaps. Where contractor payments fall due before grant receipts arrive, a temporary advance from the sinking fund — repaid as the grant lands — is a mechanism that some OMCs use to avoid bridging finance from a third party. This requires careful board authorisation and a clear repayment schedule.
• The two pots must remain strictly separate. Drawing the sinking fund down to zero to fund remediation, without a levy to replenish it, leaves the OMC exposed to the next capital event — a lift failure, a roof replacement — with no reserve. The levy and the sinking fund should be planned together: the levy covers the remediation cost, and the sinking fund contribution continues at its normal rate, or is temporarily reduced with a planned catch-up schedule once the levy is fully collected.

An OMC that empties its sinking fund to pay for remediation and stops collecting contributions during the levy period is trading one emergency for the next. The two planning exercises need to happen in the same room at the same time.

How Cuan handles remediation levy billing end to end

Cuan's billing module was designed for exactly this kind of one-off structured levy. An agent creates a levy event — named, ring-fenced, with its own accounting code and dedicated reconciliation workspace — and assigns it to the affected OMC. The apportionment schedule from the annual budget pre-populates the unit-by-unit calculation; where a modified schedule applies to the remediation (say, a subset of blocks), the agent adjusts it before issue and the system shows the before-and-after for review.

Each levy demand goes out in the agent's own branding — the owner sees their managing agent's name and logo, not Cuan's — with the plain-English narrative drafted by the agent (or drafted by Cuan's AI and approved before send). The demand includes the apportionment table, every available payment method, and a prominent link to the self-serve instalment plan flow. Owners can enrol in a plan at any hour without speaking to anyone; the GoCardless direct debit is set up automatically and confirmed by email.

Every communication is logged with a delivery timestamp. The evidence trail — who was sent what, when, and whether it delivered — is available to the agent and, in appropriately aggregated form, to the directors through the Director Portal. If an owner later claims they were not notified, the agent has a timestamped, delivery-confirmed record of every touch.

The levy reconciliation workspace shows, in real time, how much has been collected against the total levy book, how many owners are in active instalment plans, how many are in arrears, and — once the grant receipt lands — a line to reconcile it against. At year-end, the levy account closes out cleanly into the accountant export alongside the annual service-charge accounts.

For agents managing multiple OMCs with remediation liabilities, the portfolio view surfaces the levy collection position across the book: which developments are on track, which have high arrears rates, and which are approaching a tranche due date with insufficient funds collected to meet the contractor payment. The goal is to surface problems at the point where the agent can still act — not after the contractor invoice has arrived and the OMC is short.

Related reading: Understanding the sinking fund's role in capital planning — Sinking funds: the complete guide. Managing members in arrears on any levy or service charge — Recovering service-charge arrears, humanely.