Landlord or tenant – Who pays for utilities and services?
For a tenant, there is more than just the cost of renting to keep in mind. In most cases, the tenant is also responsible for the cost of utilities like electricity, gas, telephone/internet, and in some cases water.
So how exactly does that work, and when are there exceptions?
If the rental property has a dedicated electricity meter, the tenant is responsible for the payment of all electricity charges.
That means when they enter a tenancy, they need to reach out to their preferred supplier to set up an account and inform them of the date of connection.
The tenant will then receive bills directly from that electricity supplier for the electricity they use.
In some cases, where the rental property might share an electricity meter (i.e a granny flat or caravan park) the electricity account will be in the landlord’s name, but charges might still be passed onto the tenant either as part of the rent, or as an additional charge of there’s a further meter for that portion of the property.
Like electricity, gas charges generally fall under the purview of the tenant but it’s something worth paying attention to at the start of your tenancy.
Ideally, when you arrive at the property, the previous tenant will have left a full gas cylinder/s that connect to appliances like water heaters and your gas cooktop.
If they haven’t it’s worth noting and raising with your property manager because chances are there’s a clause in your lease stipulating that gas cylinders are to be refilled prior to vacating a property.
Meanwhile, you will need to inform your preferred gas supplier that you have taken up residence. They will then pass on charges such as an annual service charge, while you will be responsible for contacting them to arrange a new gas cylinder when yours is running low.
It almost goes without saying that telephone and internet is the responsibility of the tenant. That means you should talk to your preferred supplier and work out a plan that suits your needs.
Prior to entering a tenancy, it’s also worth asking whether services like NBN are connected. In rare cases, the NBN may not yet be connected to a property (with ADSL still in use), and it will then require the landlord and the tenant to negotiate who pays for this new connection.
When it comes to water, things get slightly more interesting, and this one can vary a little from state to state. Generally, if the property is considered ‘water efficient’ and the property is individually metered, the tenant is responsible for excess water charges. They are also responsible for water if it’s trucked in.
However, in most cases of water provided via a piped connection, the landlord will actually be issued with the water bill.
They may opt to then pass on those charge to the tenant via an invoice, or they can factor usage into the lease.
If a property features solar power, electricity charges might be handled in a number of ways, particularly if there’s a solar rebate involved.
The options include:
1) The account is in the tenant’s name and the rebate is issued to them
2) The account is in the property owner’s name. They receive the bill and then pass on the full charges to the tenant.
3) The account is in the property owner’s name, they receive the bill and then pass on the amount, minus the rebate, to the tenant.
4) The account is in the property owner’s name, they receive the bill and then pass on the amount, plus a percentage of the rebate to the tenant.
5) The account is in the property owner’s name, they receive the bill and then electricity charges are incorporated into the rent.
Rates and body corporate
Rates and body corporate fees are the responsibility of the landlord as the owner of the property, and both are usually issued directly to the property owner.
It’s in the lease
Who pays for what utilities and services is set out within the conditions of the lease, and there may also be further items that a tenant should be aware of.
For example, if the property has a pool, the landlord might pay for monthly maintenance, but the tenant may be responsible for the purchase of any required chemicals.
That’s why it’s important to read any lease agreement carefully to understand exactly who is responsible for what items when it comes to a property, its utilities and services.
How we can help
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