Security deposits and When they can be Retained by a Landlord
A security deposit is normally paid by a tenant to a landlord at the beginning of a tenancy and should be returned promptly once the tenancy ends. The deposit does not have to be returned to the tenant on the day that the tenant leaves the accommodation and time should be allowed for inspections and repairs to be carried out and for any outstanding bills/rent to be calculated.
Although there is no specific timeframe set down in law within which the deposit should be returned to the tenant, under normal circumstances and where the tenancy agreement has been honoured, a deposit should typically be returned within 14 days of the end of a tenancy. This provides sufficient time for an inspection to be carried out, and for any repairs/ cleaning to be carried out.
The security deposit is considered the lawful property of the tenant until the landlord establishes a right to it.
When can a Landlord retain all or part of a tenant’s deposit?
By law a landlord may retain part or all of a tenant’s deposit under the following grounds only where they can establish a right to do so:
1. Rent Arrears
If at the end of the tenancy, there is rent outstanding, a landlord may legitimately retain part or all of the tenant’s deposit to cover the arrears
2. Damage to the property above normal wear and tear
Depending on what the tenancy agreement provides for, deductions may be made, or the deposit retained in full if there has been damage to the property above normal wear and tear. “Normal wear and tear” or “reasonable wear and tear” are common terms associated with rentals, and typically refer to the expected depreciation that results from a tenant living in a property. It does not include damages as a result of tenant neglect or abuse.
It is the deterioration that occurs over a period of time due to ordinary and reasonable use of a premises.
Before vacating a property, the tenant should clean the property thoroughly, remove all of their belongings and dispose of all rubbish. It is advisable for the tenant to take dated photos to show the condition of the property in which it was returned.
Ideally the tenant should request a final inspection of the property with the landlord/agent.
If a landlord claims that there has been damage to the property, the landlord should provide receipts/invoices showing the costs incurred in carrying out any necessary repairs.
3. Utility Bills
If a tenant owes money for utility bills, such as gas or electricity, and the utility bill is in the landlord's name, the landlord may withhold part or all of the deposit to cover these costs. It is advisable for the tenant to request a copy of the utility bill to ensure that they are paying only what is due by them.
4. Early Termination of Tenancy
If a tenant provides insufficient notice of their termination of the tenancy, or the tenant terminates a fixed term tenancy before the end of the agreed term then the landlord may be able to establish a right to all or part of the deposit.
Sharing with the Owner Landlord
If a tenant is renting a room(s) in a property where the landlord also resides and is the owner of that property, this is what is known as a licence arrangement. In a licence arrangement the normal landlord and tenant laws do not apply.
As such, if a tenant’s deposit is not returned or deductions are made which are unfair then as a licensee, the tenant cannot refer a dispute to the Residential Tenancies Board. The tenant would have to consider whether they can take action through the small claims court.
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