Module 8: Security Deposit (Damage Deposit)
BC-focused (Residential Tenancy Act / RTB process) with globally useful documentation habits.
Max deposit: ½ month’s rent Return deadline: 15 days (after forwarding address in writing) Deductions: consent or RTB order Big risk: weak inspection evidence
BC / Canada Priority
1) The Core Rule
A security deposit (often called “damage deposit”) is not “extra rent.” It is a restricted amount held for specific end-of-tenancy outcomes and managed under strict timelines.
What deposits are allowed (BC)
- Security deposit: up to ½ month’s rent.
- Pet damage deposit (if pets allowed): up to ½ month’s rent (one pet deposit total, regardless of number of pets).
- If both are required, maximum total deposits can equal one month’s rent.
What often goes wrong
- Deposit amount exceeds legal maximum.
- No proper move-in / move-out condition inspection report.
- Landlord “keeps deposit” without written tenant consent or RTB order.
- Missed 15-day deadline after receiving forwarding address in writing.
2) The Deposit Workflow (Best Practice + Compliance)
1
Collect the correct amount (and only what’s allowed)
Keep it simple: security deposit ≤ ½ month rent. If pets are allowed and you require it, pet deposit ≤ ½ month rent. Avoid extra “key deposits,” “cleaning deposits,” or other unofficial fees unless clearly permitted by law/policy.
2
Document the condition (this is your evidence)
Complete a move-in inspection with photos/video + a signed condition inspection report. Repeat at move-out. Weak evidence = weak ability to claim.
- Photo standards: wide shot + close-ups + date stamp (or metadata retained).
- Capture: flooring, walls, appliances, plumbing fixtures, windows, balcony, parking/storage, keys/fobs.
- Store: one folder per tenancy, with a consistent naming pattern.
3
Only claim lawful deductions
In BC, deductions typically require written tenant agreement or an RTB order. Normal wear and tear is not chargeable damage.
| Scenario | Usually OK? | What you must have |
|---|---|---|
| Unpaid rent at move-out | Often, yes | Ledger, notices, and tenant consent or RTB order. |
| Damage beyond wear & tear | Yes, if proven | Move-in vs move-out evidence, invoices/quotes, and tenant consent or RTB order. |
| Professional cleaning | Sometimes | Only if extraordinary (not normal use). Photos, checklist, invoice, consent/order. |
| Replacing old items (e.g., worn carpet) | Often, no | Depreciation matters. Wear & tear is not deductible. |
| Strata fines passed to tenant | Case-by-case | Tenancy agreement clauses + proof tenant caused it + consent/order. |
4
Return the deposit on time (or apply to keep it)
Once the landlord receives the tenant’s forwarding address in writing, the clock matters. If returning: include any interest where applicable. If disputing: follow the RTB process promptly.
Critical timing risk
Missing the legal deadline can escalate a small dispute into a large one. Your strongest defense is: inspection evidence + clear accounting + on-time action.
3) Deposit Compliance Checklist (Copy/Paste)
At move-in
- Deposit amount confirmed ≤ legal maximum.
- Receipt / confirmation stored.
- Move-in condition inspection report completed and signed.
- Photo/video set uploaded to tenancy folder.
- Keys/fobs count documented.
At move-out
- Move-out inspection scheduled + completed (two opportunities offered if needed).
- Move-out report signed (or refusal documented).
- Invoices/quotes gathered for any claimed damages.
- Tenant forwarding address in writing saved.
- Deposit returned OR RTB process started within deadline.
4) The 5 Most Common Deposit Disputes (and how to prevent them)
Pattern 1: “You never showed me what it looked like at move-in.”
Fix: standardized inspection + photos + signed report. No shortcuts.
Pattern 2: “That’s normal wear and tear.”
Fix: define wear/tear internally; claim only damage that is clearly beyond normal use.
Pattern 3: “You deducted without my permission.”
Fix: always obtain written consent for deductions or use the RTB process.
Pattern 4: “You missed the deadline.”
Fix: track dates (tenancy end date + forwarding address in writing) and action immediately.
Pattern 5: “Your invoices are inflated.”
Fix: keep 2 quotes when possible and document scope clearly (before/after photos).
5) Quick FAQ (BC)
| Question | Practical answer |
|---|---|
| What’s the max security deposit? | Up to ½ month’s rent. (Pet deposit is separate and also up to ½ month’s rent.) |
| Can I charge a pet deposit later? | Yes, if a pet is permitted after move-in (or a new tenant with a pet moves in), within the legal maximum. |
| Can I keep the deposit automatically for cleaning? | No “automatic” deductions. Document and seek written agreement or an RTB order. Normal use cleaning is usually not deductible. |
| When do I have to return the deposit? | Within the legal timeline after receiving the tenant’s forwarding address in writing (and tenancy ends), unless you apply through the RTB to keep it. |
| What’s the #1 evidence that wins deposit disputes? | A complete move-in and move-out condition inspection report plus clear photo/video evidence and invoices. |
6) LandlordPass System Standard (recommended)
Folder naming standard
[Property] / [Unit] / [Tenant Lastname] / [YYYY-MM-DD Move-In]
- 01 Lease & Addenda
- 02 Deposits & Receipts
- 03 Move-In Inspection (photos + report)
- 04 Communications (move-out, repairs)
- 05 Move-Out Inspection (photos + report)
- 06 Invoices & Claims
- 07 Deposit Return / RTB
Deposit return package (minimum)
- Itemized statement (if any deduction requested).
- Invoices/quotes + before/after photos.
- Proof of tenant consent OR reference to RTB dispute process filing.
- Payment record for returned amount (e-transfer / cheque # / confirmation).
Suggested References (BC primary sources)
For your citations block across modules, these are strong, public, and stable references:
- BC Government — Deposits & fees (security/pet deposit maximums)
- BC Government — Moving out (deposit return timing after forwarding address)
- BC Laws — Residential Tenancy Act (condition inspection requirements)
- RTB Policy Guideline 17 (Security Deposits and Set Off)
- TRAC — Deposits & Condition Inspection Reports (plain-language guidance)