Rera Act
Maharashtra
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Andhra Pradesh
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Uttar Pradesh
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Gujarat
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- General
- Author: Riya Kapur
Highlights
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UP RERA introduces IFMS framework: The 12th Amendment to the UP RERA (General) Regulations, 2019 establishes a comprehensive framework for the collection, management, transfer, and utilization of Interest Free Maintenance Security (IFMS).
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Separate IFMS bank account mandatory: Promoters must collect IFMS at the time of sale deed registration, deposit the entire amount into a separate designated bank account, and invest it in the highest interest-bearing fixed deposit offered by scheduled banks.
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Transparent transfer to RWAs: During project handover, promoters are required to transfer the complete IFMS corpus, along with unit-wise collection details, audit trails, expenditure records, and supporting documents, to the Resident Welfare Association (RWA).
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nhanced accountability and homebuyer protection: The amendment mandates annual audits of IFMS accounts by RWAs, standardized IFMS rates, and strict financial record-keeping to ensure transparency, prevent misuse of maintenance funds, and strengthen homebuyer confidence.
The Uttar Pradesh Real Estate Regulatory Authority (UP RERA) has issued the 12th Amendment to the Uttar Pradesh Real Estate Regulatory Authority (General) Regulations, 2019 on 13 July 2026.
This amendment introduces a comprehensive framework for the Collection, Management, Transfer, and Utilization of the Interest Free Maintenance Security (IFMS) collected by promoters from homebuyers. The objective is to bring greater transparency and accountability in handling maintenance funds until they are transferred to the Resident Welfare Association (RWA).
What is IFMS?
Interest Free Maintenance Security (IFMS) is a one-time amount collected by the promoter from allottees to create a maintenance corpus for the project.
The fund is meant exclusively for:
- Maintenance of common areas
- Repairs and replacement of common facilities
- Operation of essential services
- Long-term upkeep of the residential or commercial project
Unlike monthly maintenance charges, IFMS is collected only once and is transferred to the RWA after handover.
Major Changes Introduced by the 12th Amendment
1. Separate IFMS Bank Account is Mandatory
UP RERA has made it compulsory for every promoter to:- Collect IFMS at the time of registration of Sale Deed, Lease or Sub-Lease.
- Deposit the entire amount in a Separate Designated Bank Account.
- Invest the amount in the highest interest-bearing Fixed Deposit available from Scheduled Banks.
This ensures that IFMS money remains protected and is not mixed with project funds.
IFMS Charges Prescribed by UP RERA
A. Multi-Storey Group Housing Projects
Category | Carpet Area | IFMS Rate |
|---|---|---|
EWS | 30–40 sq.m. | ₹20–30 per sq.ft. |
LIG | 35–45 sq.m. | ₹30–40 per sq.ft. |
Studio Apartment | 35–45 sq.m. | ₹30–40 per sq.ft. |
MIG | 45–90 sq.m. | ₹40–50 per sq.ft. |
HIG | 90–200 sq.m. | ₹50–60 per sq.ft. |
Luxury Housing | 200–300 sq.m. | ₹70–80 per sq.ft. |
Ultra Luxury Housing | Above 300 sq.m. | ₹90–100 per sq.ft. |
B. Plotted Group Housing
Plot Size | IFMS Rate |
|---|---|
Below 100 sq.m. | ₹20–30 per sq.ft. |
Above 100 sq.m. | ₹30–40 per sq.ft. |
C. Commercial Projects
Project Type | IFMS Rate |
|---|---|
Non-Central AC Projects | ₹40 per sq.ft. |
Central AC Projects | ₹50 per sq.ft. |
D. Plotted Commercial Projects
Plot Size | IFMS Rate |
|---|---|
Below 100 sq.m. | ₹20–30 per sq.ft. |
Above 100 sq.m. | ₹30–40 per sq.ft. |
Transfer of IFMS to Resident Welfare Association (RWA)
One of the most important provisions introduced is the mandatory transfer of the entire IFMS corpus to the RWA during handover.
The promoter must provide:- Complete IFMS corpus
- Unit-wise collection details
- Details of deductions (if any)
- Supporting expenditure documents
- Audit trail
- Final transfer statement
This provision significantly improves financial transparency during project handover.
How Can IFMS Be Used?
The amendment clearly specifies that IFMS funds can only be used for:- Maintenance of common areas
- Repair works
- Replacement of equipment
- Maintenance of common utilities
- Collective services benefiting residents
The IFMS amount must continue to remain in a separate account, distinct from regular maintenance collections.
Audit Requirements for RWAs
After taking over the IFMS corpus, the Association is required to:- Maintain proper books of accounts.
- Record all receipts and payments.
- Get IFMS accounts audited by a Chartered Accountant.
- Present the audit report before the AGM/EGBM within three months after finalization.
These requirements promote financial discipline and ensure accountability to residents.
Impact on Builders and Developers
Builders in Uttar Pradesh will now need to:- Revise their sale documentation.
- Update customer payment schedules.
- Open separate IFMS bank accounts.
- Maintain investment records.
- Prepare detailed transfer statements at the time of project handover.
- Ensure complete compliance with UP RERA regulations.
Failure to follow these procedures may invite regulatory scrutiny and compliance issues.
Benefits for Homebuyers
The amendment offers several advantages to homebuyers:- Greater transparency in maintenance fund collection.
- Protection against misuse of maintenance corpus.
- Better financial accountability.
- Smooth transfer of maintenance responsibilities to the RWA.
- Professionally audited utilization of IFMS funds.
Why This Amendment Matters
Maintenance funds often become a point of dispute between builders and resident associations. By prescribing standardized IFMS rates, separate banking requirements, investment norms, transfer procedures, and audit obligations, UP RERA has established a structured mechanism that protects the interests of all stakeholders.
The amendment is expected to improve governance, reduce litigation, and strengthen confidence in the real estate sector.
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