In RTA Part 3 we talked about move-in and move-out condition inspections. Today we’ll take a more detailed look at rental security deposits.
- How much can be charged?
- How many rental security deposits can be required?
- What can deposits be used for?
- Is a Tenant entitled to interest on their deposit?
Rental security deposits
A Landlord may collect a Security Deposit of up to a maximum of one half-month rent as a condition of entering into the Tenancy Agreement. If a Tenant has pets, the Landlord may also require a separate Pet Damage Deposit, which may also be to a maximum of one half-month rent.
The deposits are paid at the beginning of the tenancy (or when a pet is acquired during a tenancy) and both are held by the Landlord until the tenancy ends.
- Only one security deposit and one pet deposit can be required for a tenancy, regardless of the number of pets the Landlord agrees to.
Rental security deposits may only be used to offset damages caused as a result of the Tenant’s negligence or deliberately, which have not been repaired by the Tenant, or for outstanding rent at the end of the tenancy.
Pet Damage Deposits can only be used for damage caused by the pet to the residential property, unless the Tenant agrees otherwise.
Neither deposit can be used by the Tenant to pay rent unless the Landlord gives consent to this in writing.
How do you get your refund?
At the end of the tenancy, the rental security deposits are to be returned by the Landlord (less any deductions agreed to at the move-out condition inspection) within 15 days of either:
- the date the tenancy ends
- the date the Landlord receives the Tenant’s forwarding address in writing, whichever is later
VERY IMPORTANT NOTE: If the Tenant doesn’t provide a forwarding address within one year of the end of the tenancy, the deposits are forfeited and the Tenant may no longer recover them.
Interest on rental security deposits
Interest is paid on deposit(s) at a rate set out by the Residential Tenancy Office once per year. Unfortunately, given the low prime interest rate and economic conditions of the past several years, the interest rate set for security and pet damage deposits is currently zero.
For more information relating to Deposits, check out sections 19 through 22, and 38 & 39 of the Residential Tenancy Act. You can also call the Residential Tenancy Office at 1-800-665-8779, or check their website at www.rto.gov.bc.ca.
In our final installation of the RTA series we’ll take a look at rent increases. Find out how often your Landlord can raise the rent, how much the increase can be and how much notice they have to give you.
Need answers to more of your questions? Check out the 5 key sections of the Residential Tenancy Act that you should be aware of.
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