[Rebecca Best]

Hi,
Our solicitor has advised that when funds are held in trust for the sale of land due to unpaid rates, the Council should be paying interest on the amounts held. This is the first time I’ve encountered this requirement, and after reviewing the Local Government Act and Regulations, I haven’t found any reference to interest, nor have I applied this practice previously. Does any other council grant interest?
Thank you!
Bec

[Anthony Egan]

Hi Bec

Interest can be applied to funds held in trust by local councils in NSW, but it depends on the type of fund and the council’s policy. For certain security deposits, interest is calculated and paid to the depositor upon refund, less an application fee, while for other funds, the interest may be retained by the council or applied to public benefit.

At Gunnedah Shire Council, we have a mixed bag of Trust Accounts, in which the Trust Deeds specifies that interest is paid, and other accounts have no interest paid, including surplus proceeds from the Sale of Land for Rates.

I also noticed proceeds remitted to the NSW Office of State Revenue in accordance with the Unclaimed Moneys Act, 1995 after six years are not paid any interest whilst being held by State Revenue.

Regards

Anthony

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