SVJ repair fund: How to correctly set the amount of contributions and manage

A practical guide to the repair fund in SVJ. Calculation of contributions, planning of repairs, investments and answers to the most frequently asked questions.

"Why should I pay into the repair fund when nothing is being repaired?" versus "We don't have a roof, why didn't you choose more?" – Almost every SVJ president has heard these two contradictory statements. The repair fund is a perennial topic of discussion. How much to choose? What to use it for? What if it's empty when disaster strikes?

In this article, I'll show you how to properly set up, manage, and plan for a repair fund so that you always have enough money-without overpaying unnecessarily.

What is a repair fund

Repair fund (properly "long-term repair and maintenance deposit") is money that owners regularly contribute to future repairs to common areas of the home.

Legal basis

Act No. 89/2012 Coll. (Civil Code) § 1180: "The owner of the unit contributes to the management of the house and land..."

What is the fund used for

Correct use:

  • Repairs of common parts (roof, facade, wiring)
  • Maintenance (painting, cleaning)
  • Reconstruction and modernization
  • Emergency repairs
  • Technical evaluation

May not be used for:

  • Common services (cleaning, lighting, elevator)
  • Repairs in individual apartments
  • Operating costs SVJ

How to determine the amount of contributions

Method 1: According to the floor area

The most common method. Contribution = rate × flat area.

Example:

  • Illustrative rate: 25 Kč/m²/month, not a statutory universal amount
  • Flat 60 m²: 60 × 25 = 1,500 Kč/month

Method 2: According to co-ownership share

The contribution corresponds to the share of common parts.

Example:

  • Apartment share: 8%
  • Total fund: 50,000 Kč/month
  • Contribution: 50,000 × 0.08 = 4,000 Kč/month

Method 3: Combined

Part by area, part by share. It is used when the area does not correspond to the share.

What is the correct contribution amount

Indicative rates

| House Condition | Rate (Kč/m²/month) | |-----------|-------------------| | New construction (up to 10 years) | 15–25 Kč | | Good condition | 25–35 Kč | | Average Status | Kč 35–50 | | Need for reconstruction | 50–80 Kč | | State of Emergency | Kč 80+ |

Factors affecting the amount

Age of the house: Older house = more repairs = higher contributions.

Condition of the structures: Insulation, distribution, lift, roof – everything affects the cost.

Planned investments: If you know that in 5 years the facade will need to be reconstructed, start save today.

Repair history: Houses that have been repaired on an ongoing basis need less than a neglected one.

Repair planning

Short-term plan (1-3 years)

What to include:

  • Routine maintenance (coating, cleaning)
  • Known defects to repair
  • Revision and inspections
  • Small investments

Example:

  • Painting corridors: Kč 80,000
  • Bell repair: Kč 30,000
  • Lift revision: Kč 15,000

Medium-term plan (3-10 years)

What to include:

  • Major repairs (wiring, roof)
  • Modernization (insulation, windows)
  • Replacement of technologies (elevator, boiler room)

Example:

  • Facade insulation: 2,500,000 Kč
  • Replacement of water distribution: 600,000 Kč
  • New elevator: 1,200,000 Kč

Long-term plan (10+ years)

What to include:

  • General renovation
  • Complete technology renewal
  • Construction modifications

How to create a plan

  1. Map the condition of the house – Technical inspection, expert opinion
  2. Estimate Cost - Quotations, Market Research
  3. Prioritize – What is most urgent
  4. Spread into years - Realistically according to financial possibilities
  5. Calculate the necessary contributions

Calculation of the necessary contributions

Calculation example

Situation:

  • House with 20 apartments, total area 1,500 m²
  • Planned repairs for 5 years: Kč 3,000,000
  • Current fund balance: Kč 500,000
  • We need to save: 2,500,000 Kč

Calculation:

  • 2,500,000 Kč / 5 years / 12 months = 41,667 Kč/month
  • Per 1 m²: 41,667 / 1,500 = 27.78 Kč/m²/month

Conclusion: The contribution should be calculated from the building's maintenance plan, forecast costs, ownership shares and current decisions; Kč/m² figures are planning examples, not a statutory minimum.

Emergency reserve

Always have a reserve for unexpected events:

  • Minimum: 10% of the annual contribution
  • Ideal: 15-20%
  • Critical systems (roof, wiring): more

Investing a repair fund

Current account

Advantages:

  • Immediate availability
  • Zero risk

Disadvantages:

  • Minimal or no return
  • Inflation devalues savings

Savings account

Advantages:

  • Modest return (1-4% per year)
  • Still high availability

Disadvantages:

  • Notice period for better rates

Time deposits

Advantages:

  • Higher yield
  • Certainty of yield

Disadvantages:

  • Limited availability
  • Penalty for early withdrawal

Recommendation

Spread funds:

  • 50% on a current/savings account (quick availability)
  • 30% on a term deposit 1 year
  • 20% on a term deposit 2-3 years

Accounting for the repair fund

Separate records

The repair fund should be recorded separately from operating funds:

  • Separate bank account (ideally)
  • At least separate analytics in accounting

Reporting

Owners have the right to information:

  • Fund status as of date
  • Summary of contributions (owners' payments)
  • Summary of drawing (invoices for repairs)
  • Planned investments

Annual statement

Present at the meeting:

  • Initial status
  • Income (contributions)
  • Expenses (repairs)
  • Final status
  • Comparison with plan

Problems and solutions

Problem: The fund is empty and a crash is coming

Solution:

  1. Extraordinary allowance (one-off)
  2. Credit to SVJ
  3. Postpone less urgent repairs

Prevention: Maintain a crash reserve.

Problem: Owners don't want to raise contributions

Solution:

  1. Submit a clear plan with the numbers
  2. Show the consequences of the delay (more expensive repairs, damage)
  3. Offer incremental increases
  4. Get majority support before assembly

Problem: Some owners don't pay

Solution:

  1. Written reminder
  2. Interest on delay (if the statutes allow)
  3. Judicial enforcement (payment order)
  4. As a last resort execution

Problem: One owner blocks repairs

Solution:

  1. Explain the importance of repairs
  2. Offer an installment plan
  3. In case of refusal, legal voting applies (majority decides)
  4. Negligence costs can be recovered as damages

Tax considerations

Owner contributions

Long-term repair contributions are commonly accounted for as advances, but their accounting and tax treatment depends on the SVJ's actual transactions and current Czech rules.

Investment income

Interest from savings accounts is SVJ income and is subject to SVJ taxes.

Expenses for repairs

Repairs are charged as costs in the year of execution.

Example of management with the repair fund

SVJ Lipová 15 – annual management:

| Item | Amount | |---------|--------| | Initial state (1.1.) | 850,000 Kč | | Owner Posts | 480,000 Kč | | Total Revenue | 1,330,000 Kč | | Roof Repair | -280,000 Kč | | Painting corridors | -65,000 Kč | | Elevator repair | -45,000 Kč | | Total Expenses | -390,000 Kč | | Final status (31.12.) | 940,000 Kč |

Plan for the next year:

  • Target balance in 3 years: 2,500,000 Kč (insulation)
  • Need to save: 1,560,000 Kč
  • Monthly: 43,333 Kč (increase in contributions by 8%)

Summary: Fund management principles repair

  1. Plan Ahead – Always have a 5-10 year plan
  2. Set Realistic Contributions - According to house condition and plan
  3. Maintain reserve - Minimum 10% for crashes
  4. Invest Wisely – Spread Funds
  5. Inform Owners – Transparency builds trust
  6. Collect debtors – Invalidity threatens all
  7. Update Plan – Revise once a year

A well-managed repair fund is the foundation of happy living in an apartment building. When you have money for repairs, you can react in time - and a timely repair is always cheaper than a crash.

> Czech-law scope and editorial note: Legal, tax, accounting, tenancy, service-charge, condominium, metrology, insurance and data-protection statements in this article refer to the Czech Republic and the rules effective for the relevant date. Figures and examples are illustrative, not legal or tax advice. Verify current rules with the relevant Czech authority or a qualified adviser.

> SVJ clarification: SVJ formation, registration, quorum, per-rollam decisions, challenges, remuneration, tax treatment and contributions follow current Czech Civil Code and tax rules. "Fond oprav" is common shorthand, not a universal statutory account or Kč/m² rate; examples are planning illustrations.