We are often asked by new tenants and landlords who is responsible for paying what when it comes to utility costs in a rental property. Here's a clear run-down and worthy reminder for both landlords and tenants of their responsibilities.
Who pays for water usage - the tenant or the landlord?
Unless agreed otherwise by the landlord, water usage costs are generally paid by the tenant. There are some minimum requirements of the property in order to do this however, such as ensuring the home is individually metered and the rental property meets water efficiency standards.
Importantly, the landlord can not pass on to the tenant the cost of the water and sewerage services, only the cost of the water usage.
The way the bills are provided to the tenant is also important. As a landlord you must seek reimbursement for the water usage within 3 months of receiving the bill, otherwise the tenant is not required to pay. Also, the tenant must be provided a copy of the water bill showing the water usage charges or other evidence of the water usage calculation.
The tenant must be given 21 days to pay the bill. If the bill is not paid, the landlord can take action to reclaim this money at a later stage by making a claim against the bond.
Landlords must pay the water bill regardless of whether the tenant has paid this cost. i.e. as a landlord you cannot delay payment of the water bill simply because you're yet to receive the money from the tenant.
Who pays for electricity and gas in a rental home?
Electricity and gas are payable by the tenant, not the landlord. Similarly to water usage however, this applies only where the premises are separately metered. If the home is not separately metered, there can be no clear evidence of the tenant's individual usage and therefore they can not be made responsible for payments.
Who pays for phone and internet connections in a rental property?
Often to the surprise of tenants, a landlord is actually not required to provide telephone, television and internet connections with the premises. While it seems these are relatively "essential" connections, the landlord is under no obligation to provide these with the property.
If a phone, internet or television connection is not installed at the property, the tenant can request this of the landlord, however no connections must be made without the landlord's consent.
If the landlord agrees to the installation of such a connection, the installation will be at the tenant's expense (unless the landlord specifically agrees to contibute to the cost). The tenant is also responsible for paying for any repairs to the connections they have requested be installed.
An important note for landlords - if your rental property has phone, TV or internet sockets, it is deemed that these are facilities provided with the premises for use by the tenant, and it is presumed these are working unless otherwise noted. Therefore, the landlord is obliged to ensure these sockets are in good condition and maintained (unless this is specifically excluded in the tenancy agreement).
Landlords, have your property manager pay rates on your behalf
If you're a landlord with a property managed by Carnelian Property Management, we can process payment of water rates, council rates, maintenance and more on your behalf. These payments can be deducted from your rental income and clearly noted on your monthly and end-of-year financial reporting.
About Carnelian Property Management Newcastle
We are a family-owned and run Newcastle business. We’re landlords. We’re home owners. We’ve also been long-term tenants. We are refreshingly accessible with intimate knowledge of the greater Newcastle, Lake Macquarie and Fern Bay rental markets.
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