Can a NSW Landlord Charge a Tenant for Water Usage?

For a typical NSW residential tenancy, the landlord pays the water account. The question is which part of it can be recovered from the tenant. NSW Fair Trading's water supply and charging guide separates fixed water and sewerage service charges, which normally stay with the landlord, from eligible water usage charges.

This matters at the start of a lease, when a bill arrives, and when a tenant moves out. An unclear meter reading or missing water-efficiency evidence can turn a routine invoice into a dispute.

The four checks before billing a tenant

NSW Fair Trading says a landlord can ask a tenant to pay water usage only where all four conditions are met:

1. The property is separately metered, or water is delivered by vehicle to a property without a water supply service.
2. The property meets the prescribed water-efficiency measures.
3. The amount passed on does not exceed the supplier's charge for the tenant's water use.
4. The tenant receives the relevant part of the supplier's bill, or other evidence of the cost of their usage.

Having a lease clause that says “tenant pays water” is not a substitute for these conditions. For a unit with a shared meter, do not estimate a share of the building's bill and assume it is recoverable under the ordinary private-tenancy rules. Social housing and tank-water arrangements can have different provisions; check the relevant official guidance for those cases.

What counts as water efficient in 2026?

The property's relevant shower heads and internal kitchen and bathroom taps must meet the prescribed flow-rate limit of 9 litres per minute. Toilets must be dual-flush and have at least a 3-star WELS rating. Taps and toilets must not be leaking at the start of the tenancy or when the other water-efficiency measures are installed, repaired or upgraded. The toilet requirement has applied since 23 March 2025. The precise fixtures covered, and exceptions for some taps, are set out in the NSW Government water-efficiency guide.

For landlords, a practical check is to keep the plumber's report, product details or other evidence with the property file. Record the water-efficiency features on the condition report. For tenants, it is reasonable to ask the agent how the property meets the requirements if a usage charge is passed on. A water-efficient fitting should also remain in place; tampering with it can create costs and disputes.

The bill must be timely and clear

The landlord or agent must request payment within three months after the supplier issues the bill and allow the tenant at least 21 days to pay. Give the tenant a copy of the usage portion of the bill or equivalent cost evidence. Water usage should be charged separately from rent, so the amount and due date are easy to understand.

Supplier billing dates rarely match tenancy dates. At move-in and move-out, record the meter reading on the condition report and keep a photo where practical. If the account spans two tenancies, calculate only the usage attributable to the relevant tenant rather than forwarding the entire bill. Any rebate that reduces the landlord's water usage charge must be passed on to the tenant, according to NSW Fair Trading.

What if a bill looks wrong?

Start by comparing the meter reading, supplier bill period and usage amount with the tenancy dates. Check whether the property is separately metered and ask for evidence of the water-efficiency measures. If usage suddenly jumps, report suspected leaks promptly; the NSW guide gives practical leak checks. A burst pipe or serious leak may also be an urgent repair.

Raise a billing concern with the agent or landlord in writing and keep a copy. NSW Fair Trading can assist with tenancy disputes, and NCAT can consider water-charge disagreements. Do not simply ignore a payment request while a dispute is unresolved; obtain advice about the specific bill and your rights.

A simple file checklist for landlords and managers

• Confirm the property has an individual meter and record the reading at each tenancy change.
• Keep evidence of compliant taps, shower heads, toilets and leak checks.
• Separate usage from fixed water and sewerage service charges.
• Send the tenant the relevant bill evidence within the three-month request period.
• Give at least 21 days to pay and track the water charge separately from rent.
• Investigate unusual usage and respond to reported leaks promptly.

FuHouse Real Estate helps Sydney owners keep property-management records and maintenance communication organised. Learn about our property management service or contact the team about your rental.

This article is general information for NSW residential rentals, reviewed on 9 October 2026. It is not legal advice. Rules and government guidance can change; check the official sources and seek individual advice where needed.