Tenant rights and responsibilities - getting your deposit back with interest

The rules that govern deposits are different depending on the province. In Quebec, for example, landlords are not allowed to collect a deposit from tenants. And in Ontario, landlords can collect a rent deposit, but it is not the same as a “security deposit”, meaning the landlord cannot use any part of it to cover the cost of damages. In New Brunswick, it is the Office of the Rentalsman, as opposed to the landlord, that holds the deposit for the tenant until they move out.

When someone’s tenancy period expires, the deposit that was initially collected is returned to the tenant by covering their last month of rent. There is also usually a difference between the amount of the initial rent deposit and the rent as a tenant moves out. Provided the tenant has not given the landlord any extra money to increase the amount of the deposit, part of the interested that is owed is sometimes used to cover the difference between the initial amount of the deposit and the total cost of last month’s rest.

Landlords, regardless of where they are in Canada, cannot keep a tenant’s deposit if they are moving out unless it is to cover damages they or their guests have caused. The landlord must negotiate payment with the tenant and in the event that the tenant disagrees, the landlord has to file a formal application with the local rental authority to keep a deposit, or charge the tenant for any damages that cost more than the deposit and interest combined.

FACT: How much money do you get back?

As a tenant, the money that you get back from your deposit depends on the specific guidelines that are laid out by your respective province or territory. Some of the most common factors that can affect how much you get back include:

  • Whether the entire amount of rent is paid
  • The amount of the deposit that is paid by the tenant to the landlord
  • The percentage of interest earned on the deposit, based on the rate set by the province or territory
  • The overall condition of the rental unit, other than regular wear and tear