Does a tenant have to pay a security deposit?
A landlord may require a tenant to pay a security deposit as a condition of entering into a tenancy agreement or as a term of a tenancy agreement. However, a landlord cannot require a security deposit at any time other than when the landlord and tenant enter into the tenancy agreement.
Can a landlord require more than one security deposit?
No. A landlord cannot require more than one security deposit for a rental unit.
Can a tenancy agreement include a condition that a landlord can automatically keep a security deposit?
No. The tenancy agreement cannot include the condition that the landlord can automatically keep all, or part of, the security deposit.
How much can the security deposit be?
A landlord cannot accept a security deposit that is greater than the rent for the rental unit. In the case of a tenancy agreement where the rent is paid weekly, it would be the equivalent of one week’s rent; and in the case of a tenancy agreement where the rent is paid monthly, it would be the equivalent of one month’s rent.
What happens if a landlord accepts more than the allowed amount for a security deposit?
If a landlord accepts a security deposit that is greater than the amount permitted under Section 14 (3) of the Act, the tenant may deduct the overpayment from rent or file a Tenant Application to Determine Dispute with the Rental Office (Form 2A).
Does the landlord have to provide a receipt for the security deposit?
Yes, the landlord is required to give the tenant a written receipt stating the amount of the security deposit, the date of receipt, and the rental unit address.
Once the security deposit is given to the landlord, where does it go?
The landlord must deposit the money in an interest-bearing account at a financial institution located in the province authorized to accept deposits. This must be done within two banking days from when the landlord received the security deposit. If the landlord has three or more rental units, the interest-bearing account must be a trust account used exclusively for security deposits.
Does the security deposit earn interest?
Yes. When a landlord returns the security deposit to a tenant, they shall include the full amount of the deposit, plus any interest that has accrued over the time that the landlord has held the security deposit. The amount can be determined using the Interest Rate Calculator on the Rental Office website.
How long does a landlord have to return the security deposit?
A landlord has 15 days from when a tenancy ends to make a determination regarding the security deposit. The landlord can decide to:
- pay it back in part,
- pay it back in full with interest, or
- file an application to with the Rental Office keep all or part of it.
Can a landlord keep all or part of a security deposit without filing an application?
Yes, there are 2 exceptions that allow a landlord to keep all or part of a security deposit without filing an application:
- if the landlord and tenants agree in writing that the landlord will keep all or part of the funds, or
- if the landlord has an Order from the Director against the tenant for an unpaid amount.
What are the steps for a landlord to follow regarding the return of a security deposit?
If a landlord plans to keep any or all of the security deposit and interest, the landlord must file a Landlord Application to Determine Dispute with the Rental Office (Form 2B) within 15 days after the tenancy has ended. The relevant option on the Form is (e) “to make claim against the security deposit”.
What if the tenant agrees to the landlord retaining an amount from the security deposit?
A landlord may keep all, or a portion of, a security deposit if, at the end of a tenancy, the tenant agrees in writing that the landlord may keep the amount to pay a liability or obligation of the tenant.
Other than a written agreement with the tenant, are there any circumstances where a landlord can automatically keep a security deposit without having to file an application with the Rental Office?
A landlord may keep a portion of the security deposit if the Director of Residential Tenancy has previously ordered the tenant to pay an amount to the landlord (Example: for damages or for rent owed) and the amount is unpaid at the end of the tenancy. The amount owing can be deducted from the security deposit when it is returned to the tenant.
What happens if a landlord doesn’t return the security deposit or file an application with the Rental Office within 15 days of the tenancy ending?
A tenant can file a Tenant Application to Determine Dispute with the Rental Office (Form2A). The relevant option on the form would be (h) “to request the return of the security deposit”.
Are there consequences to a landlord not returning a security deposit or filing an application with the Rental Office within the required 15 days?
Yes. The landlord will not be able to make a claim against the security deposit and may be required to pay the tenant double the amount of the security deposit.
How can a landlord repay a security deposit to a tenant?
A landlord can repay a deposit by sending a cheque by ordinary or registered mail to an address provided by the tenant, by giving the deposit personally to the tenant, or by using any form of electronic payment or transfer to the tenant.
What if a tenant does not provide a forwarding address to a landlord for the return of the security deposit and the landlord does not have other contact information?
If a tenant has not provided an address to a landlord in accordance with clause 40(5)(a) within six months after the end of the tenancy, and the landlord has made reasonable efforts to repay the security deposit in accordance with subsection 40(5), the landlord may keep the security deposit. The tenant will no longer have a right to the security deposit.
If you have questions about Security Deposits, please contact our office by calling 902-368-7878 or emailing askrental@peirentaloffice.ca