Are you looking to understand Saskatchewan security deposit laws?
The security deposit is an essential component of any landlord-tenant relationship. It must be properly described in your rental property lease agreement. However, you can't make up novel security deposit rules that fail to comply with Saskatchewan security deposit laws.
Whenever you are drafting a rental agreement, you need to focus on the duration, amount, and other rules concerning security deposits. Both sides of the contract need to have a full understanding of the key facts.
In this article, we are going to take an in-depth look at the security deposit laws in Saskatchewan. You'll learn about the proper amount, storage, return, and other basic elements of security deposits.
The Starting Point: Security Deposit in Saskatchewan
As a landlord in Saskatchewan, you have the right according to Saskatchewan landlord-tenant law to ask your tenants for a security deposit. The aim of the security deposit is to protect yourself against potential financial loss that results from a renter's negligence.
The critical point is this: every security deposit is refundable. You can't ask for a fixed fee from your tenant and call it a security deposit. Whenever a paid sum is deposited, the tenant has the right to get it back as based on the law.
What could that financial loss be in the first place? Let's take a closer look at some of the common examples of how security deposits are used to alleviate financial damages. All these examples contain legal justifications in Saskatchewan:
The tenant has damaged the property due to negligent behaviour. Whenever something isn't normal wear and tear anymore, it can be deducted from the security deposit under the right legal circumstances.
You renter has missed monthly payments. This is one of the top reasons for security deposit claims in Saskatchewan. Missed rent payments create a concrete financial loss for a landlord.
Early termination of the lease by your tenant may justify a security deposit deduction in most cases.
Did your tenant fail to pay utilities? Whenever the lease agreement contains the transfer of utilities to a tenant, they need to take care of these responsibilities. You can make a deduction in case of unpaid utilities on your tenant's name.
Security Deposit Limits in Saskatchewan
You can ask for a maximum amount of one month's rent equivalent. If your monthly rent is $1,800, the limit for the security deposit is $1,800. Your tenants have the right to pay the security deposit in two instalments.
In practice, this means that you can ask for $900 as half of the deposit upfront in our current example. The $900 could be followed by two $450 instalments stretched over two months.
Number of Deposits in Saskatchewan
Keep in mind that you can't ask for multiple separate deposits. Your total deposit amount may not exceed one month's rent. For example, you should make sure that a pet deposit is already contained inside a security deposit.
Storing a Security Deposit in Saskatchewan
The security deposit still belongs to the tenant after transferring it to you. You may deposit the sum into a financial institution, including credit unions and banks.
In the case of staying at the same property for a minimum of five years, your tenant has the entitlement for interest accrual on the deposit. The interest calculation is regulated by the law.
Guarantee Letter instead of the Security Deposit
What if your tenant gives you a Guarantee Letter from the Saskatchewan Assistance Program (SAP) instead of a regular security deposit? That isn't a problem as a letter from social services may be used to replace a traditional deposit.
The acceptance of the security deposit guarantee is mandatory. If there's a difference between the social services' provision and the required deposit, you have the right to demand the difference from that applicant.
Should social service stop providing the guarantee, you can set a requirement for the full amount provided by your tenant. However, you need to allow for a month's notice before you put this in place.
Returning the Security Deposit in Saskatchewan
After your tenant moves out, you need to return their security deposit in seven business days. That means weekends and holidays aren't counted towards the period. Within these seven days, you need to serve your tenants with a written notice if you have a claim.
When it comes to sending a notice, you need to allow for three days when sending your notice via mail. Using an electronic channel means that the notice is deemed delivered on the first business day after getting sent.
Using Security Deposit as Last Month's Rent in Saskatchewan
Your tenant can use the security deposit as last month's rent if you have a written agreement on this. If you have no written agreement regarding this, your tenant has no legal basis to use their deposit for payment.
Laying a Security Deposit Claim in Saskatchewan
As a Saskatchewan landlord, you have the chance to claim the entire security deposit or a part of it for the following reasons:
- Your tenant didn't pay all of the utilities that they were responsible for
- Your renter failed to pay all rent due under your rental agreement
- Your tenant has damaged your property due to being negligent or careless in any manner (not to be confused with normal wear and tear)
A security deposit helps to protect your financial integrity as a rental property owner. It's a definite must if you're a landlord in Saskatchewan. Asking for a security deposit allows you to rest assured, knowing that the charged deposit covers unpaid rent and tenant damages to a certain extent.
However, it's essential to understand the laws and regulations governing the security deposit charges, storage, claims, and returns. We hope you found what you were looking for in this article. Otherwise, contact Cressman Realty & Property Management today so we can further assist you in Regina, Saskatchewan, and its surrounding areas.