What You Need to Know About Security Deposits

What You Need to Know About Security Deposits

Landlords usually ask tenants for a security deposit, sometimes called a damage deposit. It can not be more than one month’s rent at the time the tenancy starts. The Residential Tenancies Act (RTA) limits the maximum amount a landlord may ask for in a security deposit.

If your rent increases the security deposit can not be increased as the rent is increased. When you give your security deposit, it is important that you ask for a receipt. It must show the amount you paid, the date and must state that you paid the security deposit and who you paid it to.

The landlord must deposit the security deposit into an interest bearing account.  The landlord must pay you, the tenant, the interest at the end of each tenancy year unless you both agree otherwise. If both you and the landlord agree in writing, interest may be compounded annually and paid to you at the end of your tenancy.

The minimum annual interest rate that landlords must pay on security deposits is determined by a formula set out in the Security Deposit Interest Rate Regulation. You can access the Security Deposit Interest Calculator at Service Alberta’s website at www.servicealberta.ca>Landlords/Tenants>SecurtyDeposits .

Be safe out there and know your rights.

Christine Versnick
CIR Realty