When exit fee is payable

About this article

This article is general information only.  It briefly explains when a former resident’s exit entitlement is payable and provides information about the buyback of freehold units.

The information applies to all residence contracts for all accommodation units (non-freehold units (i.e.) and freehold units where an exit entitlement is payable, irrespective of when the residence contract was signed.


The tribunal is the Queensland Civil and Administrative Tribunal (QCAT).

Non-freehold units are units held under arrangements other than freehold, and include leasehold units, licenced units and units held under other similar non-freehold arrangements.

Non-freehold unit or freehold unit

The scheme operator must pay the former resident the exit entitlement on the earliest of the following days –

  • the day stated in the residence contract
  • 14 days after the settlement date
  • no later than 18 months after termination* of the right to reside (including by death) where the right to reside or unit remains unsold
  • the day fixed by the tribunal where the operator has been granted an extension.

Where a resident has died and an exit entitlement is payable, and a grant of probate must be issed under the residence contract or has been issued because of a requirement by another institution, the scheme operator is entitled to be shown the probate before the exit entitlement is paid.

Additional requirements for buyback of freehold unit

Where a freehold unit remains unsold the scheme operator must first buy the accommodation unit from the resident in time to pay the exit entitlement as stated above – that is, no later than 18 months after termination of the right to reside.

To meet the 18-month deadline, the scheme operator must enter into a contract to complete the purchase of the unit by the latest of –

  • 18 months after termination* of the right to reside
  • if the former resident has died, 14 days after the operator is shown the deceased residents probate or letters of administration
  • the day fixed by the tribunal.

Extension of time for scheme operator to pay exit entitlement

A scheme operator may apply to the tribunal to extend the time for payment of the exit entitlement. The tribunal must be satisfied that:

  • the scheme operator is unable to sell the right to reside or the unit
  • the scheme operator is likely to suffer undue financial hardship
  • extending the payment time would not be unfair to the former resident.

The tribunal may order the operator to pay the exit entitlements by instalments.

* Note – the 18- month period commences only when the right to reside is terminated.  The period does not commence when a resident arranges with the scheme operator to only market a right to reside.