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A security deposit, sometimes called a damage deposit, is money the landlord collects at the start of a tenancy. It can be used to cover any losses caused by the tenant, such as damages to the place or unpaid rent.
Landlords can only ask for a security deposit at the beginning of the tenancy. This will be the case for the majority of rentals. If they do not ask for one at the beginning, however, they cannot decide to ask for one later.
The maximum deposit that a landlord can ask for is equal to one month’s rent. If they take a larger deposit, the tenant can deduct the overpayment from a rent payment.
A landlord can also only ask for one security deposit from a tenant. They cannot take separate deposits, such as key or pet deposits. The single security deposit is meant to cover all these things.
A tenant cannot apply the security deposit towards their rent without the written consent of the landlord.
A tenant can pay the security deposit in two payments. The landlord can ask the tenant to pay up to one half of the security deposit when the tenant agrees to rent the place. The rest is due two months after the tenant moves in.
A landlord cannot give notice to vacate a rental unit or refuse to renew a tenancy agreement for the sole purpose of increasing the security deposit.
The security deposit must be held in trust by the landlord during the tenancy. It must be deposited in a trust account at a bank, credit union or other financial institution. It belongs to the tenant and must be held in trust for them. If the tenancy lasts five years or more, the tenant is entitled to interest on the deposit.
People receiving assistance under the Saskatchewan Income Support (SIS) program can receive money for a security deposit as part of their Shelter Allowance. The tenant is responsible for paying it to the landlord.
A landlord has seven business days to return the security deposit to the tenant or claim some or all of it. The seven days start when the landlord knew or reasonably should have known that the tenant moved out. A landlord can make a claim against the deposit for things like:
Tenants who need to move out because the landlord is renovating or tearing down the building are entitled to get their security deposit back unless they owe the landlord money for rent or utilities. These amounts can be deducted from the security deposit before returning it.
The landlord must use the proper form to give the tenant written notice of the claim. The notice must state why the landlord is making a claim to the security deposit. The notice can be served on the tenant in-person, by mail or by electronic means. The landlord and the tenant can also just agree in writing that the landlord will keep some or all of the security deposit.
Landlords do not have to serve this notice on tenants if they do not have a forwarding address for the tenant. A forwarding address can be an email address, a fax number, a cell phone number or a social media account where a written message can be left.
If the landlord fails to make the claim within seven business days after the end of the tenancy, the landlord loses their right to claim the security deposit. In this case, they must return it to the tenant. However, this will not prevent the landlord from making a claim against the tenant for damages. They just would not be allowed to take it from the security deposit.
If the landlord has not returned the deposit or made a claim within seven business days, the tenant can make their own application for the return of their security deposit. Tenants have up to 60 days after the tenancy ends to dispute the landlord's claim or to apply for the security deposit to be returned.
If the tenant disputes the deposit claim, they fill in the dispute portion of the notice on the claim and send it to the Office of Residential Tenancies (ORT). There is a fee to dispute a landlord's claim on a security deposit.
The ORT will set a date to hear the dispute. The landlord must pay the security deposit to ORT within 10 business days of receiving the notice. If they do not, the ORT can order the landlord to return the security deposit to the tenant without hearing from the landlord. The landlord can also file an updated list of damages at this time.
On the day of the hearing, a hearing officer will listen to the evidence from both sides. They will then decide what should happen with the security deposit. They may need some time to review the evidence before making a decision.
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