What Is the Statement of Adjustments? Understanding How Costs Are Shared at Settlement

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How Does the Statement of Adjustments Work?

In every Victorian property transaction, the Statement of Adjustments is the financial breakdown that ensures each party pays their fair share of ongoing property costs.

As outlined in our earlier article—Property Settlement Adjustments in Victoria – What Buyers and Sellers Must Understand—settlement isn’t just about transferring title. It’s about closing the books on who owes what, and to whom.

What Does the Statement of Adjustments Include?

Typical adjustments include:

  • Council rates (usually based on a July–June financial year)

  • Water authority charges (usage and service fees, apportioned to the settlement date)

  • Owners corporation fees (quarterly or annual, adjusted to settlement)

  • Land tax (if applicable and legally adjustable)

  • Rent, where tenanted (to be apportioned between vendor and purchaser)

These amounts are calculated to the exact date of settlement, ensuring neither party pays for periods outside their ownership.

Who Prepares the Statement?

The vendor’s conveyancer typically prepares the initial draft, which is then reviewed and amended by the purchaser’s conveyancer. At Victorian Property Settlements, we:

  • Check all certificates for accuracy and dates

  • Review amounts billed vs amounts paid

  • Ensure the purchaser does not contribute to costs outside their legal responsibility

  • Flag any inconsistencies for correction prior to final figures being certified

How Is the Final Amount to Pay Calculated?

At settlement, the purchaser pays:

The balance of the purchase price, minus the deposit, plus or minus adjustments

For example:

  • If council rates are paid in full by the vendor for the year

  • And settlement occurs three-quarters of the way through the year

  • Then the purchaser reimburses the vendor for the remaining quarter

These amounts are added to the final statement and processed as part of the PEXA settlement workspace.

Why It Matters: Common Errors and Their Impact

Incorrect adjustments can cost thousands—especially when:

  • Certificates are out of date

  • Vendor has paid rates early but not disclosed it

  • Purchaser is charged for water usage consumed before they took possession

  • The settlement date is entered incorrectly

We’ve seen poorly drafted adjustments result in:

  • Overpayment by purchasers

  • Vendor disputes post-settlement

  • Delays on the day of settlement

That’s why every adjustment must be calculated carefully, checked against current certificates, and verified by both parties before approval.

What If You Spot an Error?

Notify your conveyancer immediately. At Victorian Property Settlements, we can:

  • Flag the error in the workspace

  • Request corrections from the other party

  • Issue a formal dispute notice if required

Settlement should never proceed if the Statement of Adjustments is incorrect.

Final Thoughts

The Statement of Adjustments isn’t just an accounting form—it’s a binding financial record of how costs are shared between buyer and seller.

Get it wrong, and you might be out of pocket long after the keys have changed hands.

Need Help Reviewing or Preparing a Statement of Adjustments?

Victorian Property Settlements – Trusted for over 25 years to get every detail right.
📍 Frankston | 📞 03 9783 0111 | ✉️ david@quick32.com
🌐 www.victorianpropertysettlements.com.au