Rent Deposits vs Security Deposits in Newfoundland and Labrador

Understanding the rules around rent deposits and security deposits is essential for tenants in Newfoundland and Labrador. The law in this province clearly defines what landlords can and cannot ask for when you sign a lease. Let's walk through the types of deposits allowed, how they're handled, and what rights you have as a tenant.

What Is a Security Deposit – and Is It Allowed?

In Newfoundland and Labrador, the law refers to a "security deposit"—sometimes called a damage deposit—as the only type of deposit a landlord can require from a tenant. This deposit serves as protection for the landlord in case of unpaid rent or damages at the end of the tenancy. Landlords are not permitted to request any other deposit types, such as last month’s rent or key deposits.

• Maximum amount: The security deposit cannot exceed three-quarters of one month's rent whether you are renting monthly, weekly, or otherwise.
• When is it due? It is usually collected at the start of the tenancy, often before you move in.
• How must it be handled? The landlord must place the security deposit in a trust account at a recognized financial institution, separate from their personal funds.

For more in-depth information, visit Understanding Rental Deposits: What Tenants Need to Know.

Are Rent Deposits Legal in Newfoundland and Labrador?

Unlike some other provinces, landlords in Newfoundland and Labrador cannot request a "rent deposit" that covers advance rent payments. The only upfront payment allowed is the security deposit described above. This protects tenants from paying significant sums out of pocket before moving in.

How Security Deposits Are Returned

At the end of your tenancy, your landlord is legally required to return the security deposit plus any accrued interest—unless there are valid reasons to keep all or part of it, such as unpaid rent or damages beyond normal wear and tear. The landlord has 15 days from the end of the tenancy or from when you provide your forwarding address (whichever is later) to return your deposit, or provide a written explanation of any deductions.

For detailed advice on getting your full security deposit back, see How to Get Your Security Deposit Back with Interest When Moving Out.

Relevant Forms and How to Use Them

If you believe your landlord has wrongly withheld your security deposit, you can file an application with the Government of Newfoundland and Labrador’s Residential Tenancies Office. Here are the key forms and when to use them:

• Application for Return of Security Deposit (Form 12): Use this if your landlord fails to return your deposit or provide a valid deduction explanation within 15 days.
  How to use it: Complete Form 12, attach supporting documents (such as your lease and move-out inspection), and submit it to the Residential Tenancies Office. Access Form 12 on the official government site.
• Notice to End Tenancy (Various Forms): If you decide to move out, you must provide written notice: use the notice form relevant to your rental type.
  Example: Fixed-term, weekly, or monthly tenancy will each require a specific form. View all official forms and guidelines here.

What the Law Says: The Residential Tenancies Act, 2018 (Newfoundland and Labrador)

Newfoundland and Labrador’s Residential Tenancies Act, 2018 regulates rental deposits. Key sections include:

• Section 12: Limits the security deposit to a maximum of three-quarters of one month's rent
• Section 14: Specifies when and how deposits must be returned, including the 15-day deadline and written explanations for any deductions
• Section 16: Outlines the requirement for deposits to be held in a trust account

The Residential Tenancies Office is the official body administering these rules. They offer mediation, forms, and complaint resolution.

Move-In and Move-Out Inspections

While not strictly mandatory, it is strongly recommended to complete a physical inspection of your rental unit both when you move in and out. This helps document the condition and protect your deposit.

• Walk through each room with your landlord
• Take photos or videos noting any pre-existing damage
• Use a checklist or inspection form and have both parties sign it

Learn more about documenting your unit with the Guide to the Initial Rental Property Inspection for Tenants.

Your Rights and Responsibilities Around Deposits

As a tenant in Newfoundland and Labrador, your main deposit rights include:

• Only paying a security deposit (never multiple or other types of deposits)
• Having your deposit held securely and earning interest
• Receiving either the full deposit back or a detailed deduction statement
• Access to a formal dispute process if your deposit is unfairly withheld

The Tenant Rights and Landlord Rights in Newfoundland and Labrador guide covers more about protections for both parties.

Need to find your next rental? Find rental homes across Canada on Houseme with easy search and filters.

FAQ: Deposits and Tenant Rights in Newfoundland and Labrador

1. Can my landlord ask for more than one deposit?
   No. Landlords can only request a single security deposit, and it cannot exceed three-quarters of a month’s rent.
2. How can I make sure I get my deposit back?
   Complete move-in and move-out inspections, keep records of payments, and ensure you leave the unit clean and undamaged (beyond normal wear-and-tear).
3. What should I do if my landlord doesn’t return my deposit in time?
   File Form 12 (Application for Return of Security Deposit) with the Residential Tenancies Office.
4. Is interest owed on my security deposit?
   Yes. The landlord must pay interest at a rate set annually by the province, even if it is a small amount.
5. Can my landlord use my security deposit for unpaid utilities?
   Only if this is specified in your lease as a valid deduction; otherwise, it can only cover unpaid rent or damages.

Conclusion: What Tenants Should Remember

• Only a security deposit is allowed by law, never a "rent deposit"
• You have the right to a full return of your deposit (plus interest) unless there are valid deductions
• The Residential Tenancies Office is available to resolve any deposit disputes quickly and fairly

In summary, understanding and following the rules around deposits gives you added peace of mind during your rental experience.

Need Help? Resources for Tenants

• Newfoundland and Labrador Residential Tenancies Office: Official information, forms, and contact details
• Residential Tenancies Applications & Forms
• Public Legal Information Association of NL: Free legal resources for tenants
• Tenant Rights and Landlord Rights in Newfoundland and Labrador

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1. Residential Tenancies Act, 2018 (Newfoundland and Labrador): Read the full legislation here
2. Newfoundland and Labrador Residential Tenancies Office: Official Tribunal Information
3. Government of Newfoundland and Labrador – Residential Tenancies FAQs and Forms: View Forms and FAQs

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