Security Deposits in New Brunswick

New Brunswick works differently from most provinces: you do not hold the deposit. Under the Residential Tenancies Act, you must deliver any security deposit you receive to a residential tenancies officer within 15 days. The officer keeps it in a security deposit fund. The Tenant and Landlord Relations Office (TLRO) then mails a Certificate of Deposit to you and to each tenant.

A tenant may also pay the deposit directly at a Service New Brunswick centre instead of paying you. Either way, claims against the deposit and its return all run through the officer, not through you.

That changes your job. You are not deciding what to return and when. You are collecting the deposit, passing it on, and later making a claim if the tenant owes you something. The tenant's side is in our New Brunswick security deposit guide. These rules are current as of October 2026, and the province is rewriting the Act, so check gnb.ca before you rely on them.

The limits go beyond the headline number. A landlord may not require:

• a prepayment of the last month's rent;
• a single rent payment larger than the regular payments;
• a security deposit on top of the maximum.

gnb.ca puts it simply: you may ask for the first month's rent and a deposit, but not for the first and last month's rent. If you accept money in breach of these rules, you must return it to the tenant right away.

Watch the labels. The Act treats any money given as security against unpaid rent, or against a failure to keep the unit clean or repair damage, as a security deposit. A separate damage or pet deposit would therefore count toward the same cap, not sit on top of it. The Act also voids any requirement to pay an amount other than rent, a security deposit or a reasonable amount for a service tied to the tenancy. Breaking these rules is a category E offence.

A late payment fee is allowed only if the lease says so, and in the amount the regulation sets: the NSF charges your bank actually billed you for a returned rent cheque, proved by a receipt or statement.

The deposit can cover only these items:

• Unpaid rent.
• Unpaid utilities. This applies only where the lease makes the tenant pay for heat, water, electric power or natural gas and the rent does not already include them.
• An unpaid late payment fee, which in practice means bank NSF charges.
• Cleaning or repairs. The tenant must keep the unit ordinarily clean and must repair damage caused by the tenant's own wilful or negligent conduct, or by people the tenant lets in.

Reasonable wear and tear is not the tenant's responsibility, according to gnb.ca. Normal ageing from ordinary use, such as faded paint or worn carpet from everyday living, is not a deduction. The Act and the regulation do not publish a useful-life table for paint or flooring, so expect the officer to look at what happened rather than apply a fixed schedule.

Evidence matters. A move-in and move-out inspection is not required by the Act, but gnb.ca says landlords and tenants should inspect together at both points, and it offers an Accommodation Inspection Report form for both to sign. The Standard Form of Lease also has an optional box to record that an inspection took place. If you later claim cleaning or repair costs, that signed report is your best evidence. See our short answer on keeping a deposit.

1. Inspect together at move-out. Walk through with the tenant if you can and compare with the move-in report.
2. Try to agree on a split. If you and the tenant agree that you keep a portion, record it on a Security Deposit Refund Agreement form. gnb.ca calls this the quickest and easiest route.
3. Otherwise, file a Security Deposit Claim. Submit the form to the TLRO within 7 days after the tenancy ends. If the tenancy ended by a notice to quit or a notice to vacate for unpaid rent, you have until 7 days after the end of the week (weekly tenancy) or the end of the month (any other tenancy) in which it ended.
4. The officer investigates. The tenant is told about your claim and can dispute it, and a TLRO team member helps both sides understand the process.
5. The officer decides. The decision on the deposit is final and binding, subject only to a review by the Court of King's Bench. That review must be requested within 7 days and only on grounds of no jurisdiction or an error of law.
6. The balance goes to the tenant. The remaining amount is returned within 7 days of the tenant's written request. Each tenant named on the Certificate of Deposit applies separately for their share.

Treat the 7-day window as firm. The Act lets the officer use the deposit for a landlord's claim made within these periods, so do not wait for the tenant to leave a forwarding address or for repair quotes to arrive. File first, then add the evidence.

If your loss is bigger than the deposit, or you have a claim the officer cannot decide under the deposit rules, the Act has a separate route. You ask the officer to keep holding the deposit (or the part equal to your claim) by notifying the officer within 7 days after the tenancy ends. You must then start a court proceeding and serve the officer with a copy of the document within 14 days after the tenancy ends. The deposit is applied to the settlement or judgment, and anything beyond the deposit is recovered in court like any other judgment. The research behind this guide does not name the court or give a dollar limit for these claims, so ask the TLRO which court applies to your amount.

For damage, the tenant must repair it within a reasonable time. Extensive damage is also a ground to ask an officer for a notice to quit, which is covered in our landlord notice to end a tenancy guide.

Selling the property. If you sell, you must give a notice of transfer on Form 8 to the TLRO and the tenant within 7 days after the transfer. gnb.ca says the TLRO then moves all deposits on file to the new owner. Missing that notice is an offence with a fine of $140 to $640.

Starting out as a landlord? Our guide to becoming a landlord in New Brunswick covers the other basics you need around deposits and leases.

No interest to the tenant. The officer keeps deposits in interest-bearing accounts, but all of that interest belongs to the Crown and is paid into the Consolidated Fund. You owe no interest to the tenant, and there is no tenant interest rate for 2026.

Not sending the deposit in. If you collect a deposit and never deliver it, the tenant can tell the officer. The officer can order you to deliver it, and if you still do not, the officer may treat the undelivered amount as applied to the tenant's rent. Failing to deliver is a category E offence, and on conviction a judge may order delivery with interest. There is no double-the-deposit penalty in the Act.

Taking too much. A deposit above the cap, or a prepaid last month's rent, must be returned right away and is itself an offence.

Missing the claim window. The Act ties the officer's power to use the deposit for your claim to the 7-day windows described above. The research does not spell out what happens if you file late, so plan as if a late claim may not succeed.

Treating the deposit as yours. You cannot deduct anything yourself. Even when you are owed rent, the route is a claim to the officer or an agreed refund form.

This guide explains the rules in general terms; for a specific case, ask the tribunal or a licensed legal professional.