Residential Tenancies Branch

Section 10 

Security Deposit

Sub-Section 10.6

Overpayment of Security Deposit

Legislation

s. 29, 31(1), The Residential Tenancies Act
Residential Tenancies Interest Regulation

Definitions

Security deposit: is money a tenant pays to a landlord before the start of a tenancy. A security deposit can’t be more than half of the first month’s rent. The landlord holds the money until the tenant moves out. When a tenancy ends, a landlord may claim a security deposit for unpaid rent, damage, extraordinary cleaning costs or other obligation of the tenant. Many people refer to this money as a damage deposit.

Policy

A landlord can’t collect more than a half month’s rent for a security deposit.

<><><><>

If a landlord collects more than they are legally entitled to, they must return the extra money to the tenant, with interest.

<><><><>

In some cases, a landlord or tenant may not realize there is an overpayment until the end of the tenancy. If the Branch believes that the landlord may have a valid claim for more than the correct amount of the security deposit, it may try to help the landlord and tenant reach an agreement on the claim. If mediation isn’t successful, the Branch may Order the landlord to return the overpayment to the tenant. The landlord may still file a claim under Part 11 of the Act.

Procedure

Overview   

An officer learns that a tenant paid more than half a month’s rent as a security deposit. The officer contacts the landlord to discuss the matter. The officer explains how the landlord may return the security deposit overpayment to the tenant, depending on whether or not the tenancy is ongoing. If the landlord chooses not to return the extra money, the officer issues an Order instructing the landlord to return it.

Steps ▼   

During tenancy

1.   The officer asks the tenant for proof of the rent on the unit and the amount       of the security deposit paid.

2.   The officer telephones the landlord to confirm the information. If the       landlord confirms the information, the officer tells them that they are only       allowed to collect a half month’s rent for a security deposit. The officer       advises the landlord to return the extra money to the tenant, along with the       required amount of interest. The landlord can:

• return the extra money plus interest to the tenant; or
• allow the tenant to deduct it from the next month’s rent.

3.   If the landlord chooses not to return the money, the officer issues an       Order to the landlord to repay the tenant. The officer may also issue an       Order allowing the tenant to deduct this amount from a future rental       payment.

After tenancy

1.   The officer asks the tenant for proof of the rent on the unit and the amount       of the security deposit paid.

2.   The officer telephones the landlord to confirm the information. If the       landlord confirms the information, the officer tells them that they were only       allowed to collect a half month’s rent for a security deposit. If the landlord       appears to have a valid claim for more than the allowable security       deposit, the officer may try to mediate an agreement on the claim.

3.   If mediation is not successful, the officer issues an Order to the landlord       to return the amount of the overpayment to the tenant. The landlord may       continue to hold the actual security deposit and file a claim for the full       amount they believe the tenant owes them.

Forms & Form Letters

X-Referencing

For information on filing a claim for compensation, see Section 9.
For details on Mediation, see Section 1.
For information on interest on security deposits, see Section 12.

Policy Developed

September, 1992

Last Revision

March, 2004

Other Resources

None

  Top