Security Deposits in Saskatchewan

The cap is one month's rent. Section 25 of The Residential Tenancies Act, 2006 says you may not require or accept a security deposit greater than one month's rent under the tenancy agreement. If you take more, the tenant can deduct the overpayment from rent or recover it another way.

The Act also bans charging for accepting an application, processing it or investigating an applicant. It bans collecting rent in advance too, so a "last month's rent" payment is not an allowed substitute for a deposit.

Pets raise a question that the Act does not answer. It does not mention pets, so there is no separate pet deposit rule and no pet deposit maximum. A deposit held as security for damage fits the Act's definition of a security deposit, which suggests it counts toward the single deposit and the one-month cap. No government page says this in words, so ask the Office of Residential Tenancies (ORT) before you rely on a separate pet deposit.

For the tenant's side, see the Saskatchewan security deposit guide.

You hold the deposit in trust for the tenant. It is not your money while the tenancy runs, and nobody can seize or garnish it. That includes your own creditors, so keep it separate from your operating funds.

Interest depends on how long the tenancy lasts.

• Tenancy ends within five years of the agreement date: the prescribed rate is 0%, so no interest is owed.
• Tenancy longer than five years: interest is owed at a rate that is set each year. It is the Chartered Bank Administered Interest Rate for Non-Chequable Savings Deposits, as published in the Bank of Canada Review for December of the previous year.

Interest runs from the date you received the full deposit. The government's deposit page says it accrues only up to 30 days after the tenancy ends. Check the current rate before you calculate, as it changes with that yearly publication.

One more rule affects how you hold it. If the Minister responsible for The Saskatchewan Assistance Act guarantees the deposit for a tenant, that guarantee counts as paying it. You may require the deposit later only if the guarantee is withdrawn.

You may claim three kinds of cost against the deposit: cleaning, damage, and unpaid rent or utility arrears (or loss). The tenant must leave the unit reasonably clean and repair damage they or their guests caused. The tenant is not responsible for reasonable wear and tear, and the Act does not define it, so be ready to explain why an item is damage and not ordinary use.

Some things are not allowed.

• A lease clause that lets you automatically keep all or part of the deposit is banned.
• A lease cannot impose an automatic cleaning charge. You can claim actual cleaning costs, but you must prove them.
• You cannot give notice to end a tenancy, or refuse to renew one, for the sole purpose of raising the deposit.

There is one shortcut. If, when the tenancy ends, the tenant agrees in writing that you may keep all or part of the deposit, and you have paid back the rest, the claim process does not apply. Get that agreement signed and dated.

The law does not require a move-in or move-out inspection report. The ORT publishes a Condition of Premises Checklist that both sides should complete and sign at move-in and move-out. If damage is disputed later, the checklist and dated photos are the evidence you will have. See the Saskatchewan move-in and move-out reports guide.

The clock starts when you know, or should reasonably have known, that the tenant has moved out. You have seven business days. By then you must do one of two things.

1. Return everything. Pay the tenant the full deposit and any accrued interest.
2. Or claim part of it. If you intend to keep some or all, do all three of the following within the seven business days:
   • Pay the tenant the part you are not claiming, with its interest.
   • Serve a notice of claim on the approved form. The government's deposit page says landlords make the claim through the ORT online portal.
   • Keep holding the claimed part, with interest, in trust for 30 days from the day the tenancy ended.

If the tenant gave no forwarding address when the tenancy ended, you do not have to serve the notice of claim. You still have to follow the rest of the rule.

You do not apply to the ORT for a hearing. Notices of claim filed through the portal are not scheduled for a hearing unless the tenant disputes the notice and pays the filing fee. If the claim is larger than the deposit, you can file a separate monetary application (Form 9c on the Settling Disputes page), which must be made within one year after the act or omission. The application fee is $50.

The tenant has 60 days after the tenancy ends to apply to the ORT, if you did not follow the seven business day rule or the tenant disputes the amount you claimed. The fee is $50 and non-refundable.

Once the ORT notifies you, you must file the deposit, or the claimed portion, with the ORT within 10 business days. If you do not, the director may order the deposit paid to the tenant without notice to you.

Saskatchewan has no double-deposit penalty, but a missed deadline still costs you.

• If you did not comply with the rule for keeping part of the deposit, the hearing officer must order the deposit, or the part concerned, and its interest paid to the tenant, unless there were exceptional circumstances.
• If you broke the deposit rules, or made a claim without reasonable grounds, the hearing officer may also order you to pay the tenant's hearing costs. These are out-of-pocket expenses and lost income, with a $50 minimum and a $200 maximum.
• The director may refuse to schedule a hearing for a landlord who is in breach of an ORT order or has not forwarded a deposit as required.

The practical lesson is to meet the deadline even if you are unsure about the amount. A timely notice of claim keeps your position intact. A late one can mean you lose the whole claim.

Renovation or demolition notices. If you end a periodic tenancy for demolition, or for renovations that require the unit to be vacant, you must return the deposit and interest without deduction. The only exception is outstanding rent and utility arrears.

Selling the property. A new owner steps into the existing tenancies and takes over the deposits and interest. The former landlord must hand over the written agreements and the deposit records right away.

Common mistakes:

• Counting calendar days instead of business days.
• Waiting for the tenant's forwarding address before doing anything.
• Taking a pet deposit, a key deposit or a cleaning deposit on top of the one allowed deposit.
• Claiming for wear and tear or for an item you cannot show was damaged.
• Holding the deposit in your own account and spending it.

For the wider picture on what a new landlord needs to set up, see the guide to becoming a landlord in Saskatchewan. If you are unsure whether you may keep an item, the answers at when a landlord can keep a deposit and how much deposit a landlord can ask for give the short version.

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