The costs after DA approval in NSW: levies, bonds, Section 73 and more

Development approval in NSW is not the last bill before construction. Between the notice of determination and the first footing, most house, granny flat and duplex projects in Sydney pay some combination of the Building and Construction Industry long service levy (0.25% of the cost of work for projects of $250,000 or more), council security bonds or damage deposits set in the conditions, section 7.11 or 7.12 contributions, construction certificate and principal certifier fees, a Sydney Water building plan approval and, for dual occupancies and subdivisions, a Section 73 Compliance Certificate. A new or widened driveway crossing also needs a separate section 138 Roads Act approval from the council. Owner builders who budget only for the DA fee and the build are routinely caught short, and several of these must be paid before the construction certificate can be released.

Who this is for: owner builders and first-time builders with an approved DA for a new house, granny flat or dual occupancy in Sydney or the Central Coast, who want a realistic list of the costs and approvals between approval and starting work.

Why do costs keep appearing after the DA is approved?

Because a development consent is permission with conditions. The NSW Department of Planning’s homeowner guide to determinations explains that conditions apply at set stages: before a construction certificate is issued, during construction and before an occupation certificate. Common conditions include site signage naming the principal certifier and principal contractor, controls on hours of work, waste and run-off, bonds to protect the footpath, and development contributions. Each condition has a cost, and the ones marked “prior to construction certificate” have to be paid or satisfied before the certifier can issue it.

The common mistake is reading the consent’s first page (the approval) and skipping the twenty pages of conditions behind it. The budget lives in those pages.

What is the long service levy and when is it paid?

The Building and Construction Industry Long Service Payments Act 1986 funds portable long service leave for construction workers through a levy on building work. The NSW Government’s long service levy page states the levy rate is 0.25% of the cost of building and construction works of $250,000 or more, including GST. Those settings have applied since 1 January 2023, when the threshold rose from $25,000 and the rate fell from 0.35%.

Councils and certifiers will not release a construction certificate or complying development certificate until the levy is paid, or proof of payment is provided, and where work is done under contract it must be paid before work starts. Owner builders and non-profit organisations may apply for an exemption of up to 50%, so apply before paying. A worked example: a $620,000 new house attracts a levy of $1,550 ($620,000 x 0.25%).

What bonds and deposits will the council ask for?

Most councils require a security bond or damage deposit to cover damage to the kerb, gutter, footpath and road in front of the site during construction. The amount is set by the council’s fees and charges schedule or stated in the condition, and it is refunded after the final inspection if there is no damage. Other bonds that appear in residential consents include:

• tree protection bonds, where a street tree or a significant tree must be retained;
• landscaping bonds, held until the approved landscaping is in place;
• engineering or works bonds, where the consent requires civil works in the road reserve.

Photograph the footpath, kerb and road before any machinery arrives, and lodge the photos with the council if its process allows. Disputes over pre-existing cracks are the main reason deposits are not returned.

The post-approval cost checklist

Section 73 and building plan approval: the Sydney Water steps

Where your consent includes a Sydney Water condition, you will need a Section 73 Compliance Certificate under the Sydney Water Act 1994. Sydney Water’s Developer Direct service allows direct applications for dual occupancies, 2-lot subdivisions and small developments needing only minor works, and the published application cost is $1,202.92 including GST. That covers the Section 73 assessment, a review of the building plan for approval, a sewer service diagram and a fixed-price quote for any works needed. Larger projects, or those needing major works, go through an accredited water servicing coordinator. Single dwellings and most granny flats usually need only a building plan approval through Sydney Water Tap in, so that new work does not sit over or too close to Sydney Water pipes.

Start this early. A Notice of Requirements that calls for a sewer extension or a main adjustment can add months and real cost, and it is far better to know before the builder is booked.

The driveway crossing: section 138 of the Roads Act

The NSW Planning Portal’s guidance on section 138 approvals is clear: works on a public road, footpath or reserve, including creating a vehicle crossing or driving a vehicle across a kerb or footpath, need approval from the roads authority, which is usually the council. The approval is separate from the DA or CDC. For a DA, apply after approval so the plans are consistent. Councils typically ask for a site plan, the crossing location and width, gradient details from the road edge to the boundary, contractor details and public liability insurance. Many councils also require the crossing to be built by an approved contractor and inspected.

The order we suggest owner builders follow

1. Read every condition of consent and list each one with its stage (prior to CC, prior to commencement, during works, prior to OC).
2. Price each condition: contributions, levy, bonds, reports, inspections.
3. Apply to Sydney Water (building plan approval, and Section 73 if required) as soon as the consent issues.
4. Apply for the owner-builder permit, or arrange home building compensation insurance through your builder.
5. Pay the long service levy (claim any exemption first), contributions and bonds, and give the receipts to the certifier.
6. Obtain the construction certificate and appoint the principal certifier.
7. Apply for the section 138 approval for the driveway and any work in the road reserve.
8. Give the notice of commencement and start work.

Definitions

Long service levy

A levy of 0.25% on building and construction work costing $250,000 or more, funding portable long service leave for construction workers in NSW.

Security bond or damage deposit

Money held by the council during construction to cover damage to public infrastructure, refunded after a satisfactory final inspection.

Section 73 Compliance Certificate

Sydney Water’s certificate confirming a development has met its water and wastewater requirements.

Section 138 approval

Consent from the roads authority under the Roads Act 1993 for works in a public road, including driveway crossings and kerb works.

Principal certifier

The council or registered certifier appointed to inspect the work and issue the occupation certificate.

Our Statements of Environmental Effects and DA packages are prepared with the post-approval steps in mind, and we flag conditions that will carry significant cost before you accept them. If you are an owner builder with a new DA, or one about to be determined, request a fee proposal and we can review the conditions with you. For civil and stormwater conditions, our sister company Contrive Consultants prepares the engineering.