IFMS, Corpus Fund, Advance Maintenance and the Society Transfer Fee: What a Builder or Society Can Charge You

Three charges appear on a possession letter or a resale file with names that sound official and rules that are not obvious: a deposit called IFMS or a maintenance deposit, a corpus fund, and advance maintenance for some number of months. A fourth, the society's transfer fee or premium, arrives at resale. The flat-cost post lists these as line items and tells you to ask for the schedule. This post answers the next question: when someone hands you that schedule, which parts can you challenge, who is the money meant for, and which numbers are fixed by a rule rather than by negotiation. Where we could read a rule at a primary source on 6 October 2026, we quote it and name the state. Where no rule sets a cap, we say so, because "nobody has capped it" is also an answer.

A note on scope. India has no single law for these charges. The central Real Estate (Regulation and Development) Act, 2016 (RERA) sets duties for the promoter. Each state's cooperative societies or apartment ownership law sets what a society may collect. The GST Council and the Central Board of Indirect Taxes and Customs (CBIC) set the tax. The detailed numbers below are Maharashtra (cooperative housing societies), Haryana (an RERA authority order) and, for the central tax rule, CBIC. Uttar Pradesh's RERA IFMS regulation is mentioned only as reported. If your flat is in another state, the structure carries over but the figures do not. This is general information, not legal advice.

Who can charge what, in one table

IFMS: a corpus held in trust, not a deposit returned to you

IFMS stands for interest-free maintenance security. A promoter collects it from buyers around possession or the sale or lease deed and keeps it as a pool for the building's long-run upkeep and contingent capital expenditure. The name invites a misreading: "security" and "deposit" sound like money that comes back to the person who paid it. The clearest reading we found at a primary source says the opposite.

In a combined order dated 5 March 2024, the Haryana Real Estate Regulatory Authority, Gurugram, dealt with an owners' welfare association and an individual allottee who each asked for the IFMS of the Rosewood City project. The association estimated the unpaid IFMS and other funds at about ₹13.3 crore (₹13,31,92,150) and said the true amount could be higher. One allottee asked for a refund to each owner. The Authority declined the individual refund. It described IFMS as a corpus created at completion or handover to sustain maintenance and meet contingent capital expenditure, held by the promoter before handover and by the resident welfare association (RWA) after it, "a common fund to be held in trust" that cannot be dissolved and redistributed, particularly because many units have changed hands by then. It then directed the promoter to hand over the IFMS with the accrued interest, if any, the details of the amount and the audited financial details to the association.

The same order rests on RERA section 11(4)(d), which makes the promoter responsible for providing and maintaining the essential services on reasonable charges until the association of allottees takes over maintenance. That is why the IFMS question is almost always a handover question. The promoter is entitled to charge for maintenance up to handover. After handover, the money that was collected as a security belongs, in practice, to the body that now has to run the lifts and pumps.

Some states have started to regulate IFMS directly. Uttar Pradesh's RERA is reported to have amended its General Regulations, 2019 (Regulation 47) in 2026 to cover how IFMS is collected, held and handed to the association. We could not open the regulation itself on 6 October 2026, so this post gives none of its figures. If your project is in Uttar Pradesh, ask the promoter for the regulation text and the rate that applies to your category before you pay.

Corpus fund: one name, three different pools of money

"Corpus fund" is used loosely on cost sheets. In Maharashtra's draft revised model bye-laws it is defined as a payment received or receivable by the society from the developer in lieu of surrendering its development rights in the plot by registered document, or contributed by members for any purpose decided in a general meeting. A later bye-law adds that it consists of contributions from the promoter or builder, voluntary contributions from members, or other receipts approved by the general body, and that it is to be used only for purposes the general body decides.

The Maharashtra housing rules of 2026 are shorter. Rule 106C-11(8) says only that a society "may maintain" a corpus fund. That wording matters, because it separates the corpus fund from the funds a society must keep. Read next to the fund list, three different things hide under one label:

• A builder's maintenance corpus. Money collected from buyers at possession as a one-time pool and expected to move to the society once it exists. This is the same idea as IFMS, and the Haryana order treats it as held in trust.
• A redevelopment or development-rights corpus. Money a developer pays the society for giving up development rights. It is a society asset negotiated at the general body, not a charge on you as a buyer.
• A voluntary member contribution. Money members agree to put in. The draft bye-laws say donations may not be collected as a condition for admission, for transfer of shares and interest, or for a no-objection certificate or approval.

So the first question to a seller, builder or society secretary is not "how much corpus" but "which corpus", and the second is "who holds it today". A corpus that was collected by a builder and never passed to the society is an RERA handover problem. A corpus that sits in the society's books is governed by the general body.

Advance maintenance: the only test in the Act is "reasonable"

Advance maintenance is the builder's charge for running the building for a stated number of months, collected at possession and quoted in months on the cost sheet. We found no central rule that fixes how many months a promoter may collect. RERA section 11(4)(d) says the promoter provides and maintains essential services on reasonable charges until the association takes over. That is the standard the charge has to meet, and it is a test of reasonableness against cost, not a cap in rupees or months.

A practical way to apply it is to turn the advance into a monthly rate and compare it with what an association in the same city and tier charges. If the builder asks for 24 months at ₹4 per square foot per month on a 1,000 sq ft flat, the advance is ₹96,000 (24 × ₹4 × 1,000). If a nearby society of a similar build charges ₹3, the same period would be ₹72,000, and the ₹24,000 difference is a negotiating point and, if the agreement is silent on the basis, a question to put to the promoter in writing. Two things deserve a look before you pay. The first is the date from which the months run: a builder who starts the clock on the offer of possession while you cannot yet occupy is front-loading the charge. The second is what happens to the unspent balance when the association takes over, which belongs in the handover accounts.

Advance maintenance is also not IFMS. Advance maintenance pays for months of running costs and is meant to be consumed. IFMS is meant to stay as a corpus. A cost sheet that lists both is not double-charging by that fact alone, but one that lists the same pool under two names is worth challenging.

What a promoter must hand to the society under RERA

Three provisions of the RERA Act, read in the text hosted by Haryana RERA on 6 October 2026, decide whether the society or association gets what it is owed.

• Section 11(4)(e): form the association. The promoter must enable the formation of an association, society or co-operative society of the allottees, or a federation, under the applicable laws. In the absence of local laws, the association must be formed within three months of the majority of allottees having booked their units.
• Section 17(1): convey the common areas. The promoter executes a registered conveyance deed in favour of the allottee together with the undivided proportionate title in the common areas to the association of the allottees or the competent authority. In the absence of any local law, the conveyance is to be carried out within three months of the issue of the occupancy certificate.
• Section 17(2): hand over the documents. After the occupancy certificate and handover of possession, the promoter hands over the necessary documents and plans, including the common areas, to the association or the competent authority.

Section 19(10) puts a duty on you as well: an allottee takes physical possession within two months of the occupancy certificate, and section 19(11) obliges the allottee to take part in registering the conveyance. The three-month conveyance clock and the two-month possession clock are what the maintenance charges hang on. If the builder delays the conveyance, the common-area title and the corpus sit with the builder for longer than the Act intends.

Registration of the conveyance carries a state stamp duty and registration fee of its own. That cost is not a society charge and is covered by the registration cost calculator, which models it by state. Do not let a society or builder fold it into a "transfer" line on a cost sheet.

Maharashtra: what a society may hold and charge, from the June 2026 rules

Maharashtra notified the Maharashtra Co-operative Societies (Amendment) Rules, 2026 on 18 June 2026, published in the Gazette, Part IV-B, on 22 June 2026. They add a rule 106C chapter for housing societies. We read the English text of the gazette PDF on the Commissioner for Co-operation's site on 6 October 2026. Rule 106C-11 sets the funds, and rule 106C-12 sets how contributions are apportioned. These numbers are a state floor, not a national one.

A worked example, using only those minimums. If the architect certifies a flat's construction cost at ₹40 lakh, the sinking fund minimum is 0.25% × ₹40,00,000 = ₹10,000 a year (₹833 a month), and the repair and maintenance fund minimum is 0.75% × ₹40,00,000 = ₹30,000 a year (₹2,500 a month). Together that is ₹40,000 a year, or ₹3,333 a month, before service charges, property tax, water and lift charges. If the society's service charge is ₹3,000 a month, the non-occupancy charge the rule sets is 10% of that, ₹300 a month. The recurring heads are modelled flat by flat in the society maintenance charges calculator, so this post does not repeat the full build-up.

One point is easy to miss. The rule 106C-11(1) list of what feeds the reserve fund includes entrance fees and "all transfer fees or charges or premium received by the society from its members on transfers of membership". In other words, a transfer fee or premium that a society charges at resale goes to the society's reserve fund.

The resale transfer fee and premium in a Maharashtra cooperative society

At resale, the buyer applies for membership and the seller resigns, and the society records the transfer and issues a share certificate. In Maharashtra the numbers that can be read at a primary source are in the draft revised model bye-laws for tenant co-partnership housing societies, which the Commissioner for Co-operation circulated on its site in August 2026 for objections (the Marathi version carries 18-08-2026 in its file name). The draft's application forms show an entrance fee of ₹500, transfer charges of ₹500 "where applicable" and a transfer premium of "maximum Rs. 25,000" "where applicable". The same draft says the premium and transfer fee are part of the society's reserve fund and bars a society from collecting donations as a condition of admitting a member, of transferring shares, or of giving a no-objection certificate or approval.

Stack the draft's own figures and the most a resale buyer would owe the society, if every item applied, is ₹26,250: the ₹500 entrance fee, ₹250 for five fully paid shares of ₹50 each (the form's own figure), ₹500 in transfer charges and ₹25,000 in premium. Any demand above that, labelled as a donation, a redevelopment contribution or a "no-objection" fee, runs against the draft's own wording on voluntary donations. We have not read a final adopted version of the bye-laws, and an existing society follows the bye-laws it registered until it adopts new ones, so quote the clause from your society's own registered bye-laws when you reply.

Outside Maharashtra the position differs. Co-operative societies in other states run under their own cooperative societies acts and registered bye-laws, and flats in apartment-owners' associations under apartment ownership acts. We have not read those instruments today, so we give no cap for them. If your society is in another state, the question is the same: which bye-law, which circular, and what is the maximum.

GST on society maintenance: the ₹7,500 line and the 18% question

CBIC Circular 109/28/2019-GST, dated 22 July 2019, sets the rule for what an RWA or society charges its members. Supply by an RWA to its members, up to ₹7,500 per month per member, for services and goods for the common use in a housing society or residential complex, is exempt. The limit was ₹5,000 until 25 January 2018 and became ₹7,500 from that date, under clause (c) of serial number 77 of notification 12/2017-Central Tax (Rate). If the RWA's aggregate turnover is ₹20 lakh or less in a financial year, it does not need to register and pay GST even when charges exceed ₹7,500. It must pay GST only when the monthly charge is above ₹7,500 per member and its annual turnover is ₹20 lakh or more.

The circular answers the "which amount" question in the member's disfavour. Where charges exceed ₹7,500, the entire amount is taxable, not just the excess. Its own example: at ₹9,000 a month, GST at 18% applies to ₹9,000, not to the ₹1,500 above the ceiling. That is ₹1,620 a month, or ₹19,440 a year, against ₹270 a month (₹3,240 a year) if tax applied only to the excess. A person who owns two flats in the same complex is treated as a member for each, and the ₹7,500 ceiling applies to each flat separately, so two flats at ₹7,500 each stay exempt.

What the circular does not say matters here. It is written for an RWA's monthly subscription. It says nothing about a builder's one-time advance maintenance invoice or about IFMS. If a builder adds GST to advance maintenance, ask for the invoice basis and the GST registration in writing, and use the GST on property calculator for the construction-linked GST on the flat itself, which is a separate matter.

Possession day and resale day: a checklist you can use

At possession, from the builder

1. Ask for the rate card behind IFMS and advance maintenance, in rupees per square foot and months, and ask which area it is charged on (carpet or super built-up).
2. Ask whether the IFMS is held in a separate account, in whose name, and when it will be handed to the association. Ask for the answers in writing, and ask for the state regulation if your state has one.
3. Ask the date from which advance maintenance months run and what happens to the unspent balance at handover.
4. Ask whether the association or society has been formed (RERA 11(4)(e)) and when the conveyance of common areas will be registered (17(1) and its three-month proviso where no local law applies).
5. Keep every receipt. The head on the receipt is the proof of what the money was for when a later dispute starts.

At resale, from the society

1. Ask for the transfer fee, the premium and the entrance fee as three separate lines, with the bye-law or circular that fixes each.
2. Ask for a no-dues certificate and the current maintenance, sinking fund and repair fund rates, then compare them with the Maharashtra minimums above if your society is there.
3. Refuse a charge labelled a donation or a corpus contribution as a condition of admission unless the society can point to a rule that allows it; the Maharashtra draft says donations may not be a condition of transfer.
4. Ask whether the corpus fund the seller paid is held by the society, and do not agree to pay it again on the seller's behalf without it being reflected in the price.
5. Check that the seller has cleared the society's dues, because the society's charge on the shares and interest survives a transfer; the draft form says so in terms.

What we could and could not read, and what it means

The kill rule for this post was that fewer than two state or central rules read at primary source on the day would reduce it to the one-line mentions in the flat-cost post. We read five (plus the 2014 bye-laws for the transfer fee): the RERA Act's text (sections 11(4), 17, 19), the Maharashtra housing rules of June 2026, the Maharashtra draft bye-laws, the CBIC circular and one Haryana RERA order. We could not read the Uttar Pradesh IFMS regulation at the regulator's own PDF, and we did not read the government circular that the 2014 bye-laws cite for the premium limit. Neither gap supports any figure in this post, and the ₹25,000 ceiling is labelled as read from a draft.

Three conclusions hold up on what we did read. The first is that IFMS and similar corpus money is, on the one authority order we read, treated as a common fund for the building, with the association as its end owner. The second is that the "reasonable charges" standard in RERA section 11(4)(d) is the only test for advance maintenance we could find, which makes the rate card, not the headline, the thing to negotiate. The third is that a resale premium above the draft bye-laws' ₹25,000 maximum in a Maharashtra society needs a clause to support it, and the 2014 model bye-laws, which the Commissioner's site still lists, set no rupee figure for it.