Residential Tenancies Branch

Section 2 

Tenancy Agreements

Sub-Section 2.4

Late Payment Fees

Legislation

s. 69(4) , The Residential Tenancies Act;
s. 21.1, 23 Residential Tenancies Regulation

Definitions

House rule:  a written rule a landlord may have for tenants in addition to the obligations in a tenancy agreement.    For example: A tenant may not have a pet in the rental unit.

Tenancy agreement:  a contract between a landlord and a tenant that sets out the basic rules for living in a rental unit. It can be written, oral or implied.

Policy

A tenant is responsible to pay the landlord the full rent on the day the rent is due. If the rent is not paid on time, the landlord may charge the tenant a late payment fee.

A landlord must tell a tenant in writing that they will charge a late payment fee if the tenant doesn’t pay rent on time. A landlord can include this information:

• on a tenancy agreement;
• in the house rules; or
• n a separate notice given directly to the tenant; a landlord can’t just post a general notice in the lobby or entrance way about late fees.

Once a tenant knows about the fee, a landlord is entitled to charge it.

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The rate for a late payment fee is set by regulation. A landlord cannot charge more than what has been set by regulation. A landlord may charge a late payment fee of:

• up to $5.00 for the day the rent was due; and
• up to $1.00 for each day after the due date that the rent is late in any consecutive number of rental payment periods, to a maximum of $65.00.

When a landlord charges a late payment fee, the tenant must pay the daily rate:

• up to and including the day they actually pay the rent in full; or
• the fee reaches the $65.00 maximum.

Example #1: The tenant is supposed to pay their rent on July 1. The tenant doesn’t pay the rent until July 8. The landlord is entitled to a late payment fee of $12.00 ($5.00 for July 1 and $1.00 per day for July 2 to July 8).

Example #2: The tenant is supposed to pay their rent on July 1. The tenant pays part of their July rent on July 1, but doesn’t pay the balance of July’s rent until August 8. The tenant also pays their August rent on August 8. The landlord is entitled to a late payment fee of $43.00 ($5.00 for July 1 and $1.00 per day for July 2 to August 8).

Example #3: The tenant is supposed to pay their rent on the first of each month. The tenant stays in the rental unit, but doesn’t pay their rent in July, August or September. The landlord is entitled to $65.00 for a late payment fee ($5.00 for July 1 and $1.00 per day starting July 2 to the maximum of $65.00).

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When a landlord claims a late payment fee on an Application for an Order of Possession or a Claim for Compensation, the Branch calculates the fee up to and including the date of the hearing, to a maximum of $65.00.

Example #1: The tenant owes July rent and doesn’t move on the landlord’s notice. The landlord applies for an Order of Possession and claims rent and a late payment fee. On July 25, the Branch holds a hearing on the landlord’s application. The Branch awards the landlord a late payment fee of $29.00 ($5.00 for July 1 and $1.00 for each day up to and including July 25).

Example #2:  The tenant owes July and August rent. The landlord applies for an Order of Possession and claims rent and a late payment fee. On September 8, the Branch holds a hearing on the landlord’s application. The Branch awards the landlord a late payment fee of $65.00 ($5.00 for July 1 and $1.00 for each day up to the maximum of $65.00).

Example #3:  The tenant moves out at the end of July owing July rent. The landlord files a claim against the tenant for July’s rent and a late payment fee. On September 20, the Branch holds a hearing on the landlord’s claim. The Branch awards $65.00 for a late payment fee ($5.00 for July 1 and $1.00 per day starting July 2 to the maximum of $65.00).

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A landlord may also claim accumulated late payment fees at the end of a tenancy if the claim is made in a timely manner.   For example: At the start of a tenancy, a landlord tells a tenant in writing that they charge a late payment fee. The rent is due on the first of each month. During the one year agreement, the tenant pays their rent late four times – March 5, May 4, June 8 and September 3. At the end of the tenancy, the landlord may claim a total late payment fee of $36.00 ($9.00 for March, $8.00 for May, $12.00 for June and $7.00 for September).

The landlord may:

• deduct the accumulated late payment fee from the security deposit at the end of the tenancy with notice to the tenant; or
• include the accumulated late payment fee on a claim for compensation they file with the Branch.

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A landlord can’t terminate a tenancy for non-payment of late payment fees only.

Procedure

Overview   

This policy is included as information for landlords, tenants and officers. If tenants and landlords can’t agree on the amount of late payment fees, they can ask the Branch for help.

Steps ▼   

1.   The officer encourages the tenant and the landlord to share information,       and to discuss the problem, to try to come to an agreement.

2.   When a landlord or tenant asks the Branch for help with a late payment       fees problem, the appropriate officer follows the procedures for:

• mediation
• claims for compensation/orders of possession
• hearings

Forms & Form Letters

X-Referencing

None

Policy Developed

September, 1992*

Last Revision

March, 2004

Other Resources

None

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