Rent deposits in Ontario: what landlords can and can't ask for
Deposits are one of the most common sources of confusion between landlords and tenants in Ontario. For rentals covered by the Residential Tenancies Act (RTA), the rules are short and strict.
Rent deposit (last month's rent)
- A landlord can ask for a rent deposit, usually called last month's rent.
- It can't be more than one month's rent (or one week's rent for a weekly tenancy), or one rent period if that's shorter.
- It can only be used as rent for the last rent period before the tenant moves out. It can't be used for damage, cleaning or unpaid utilities.
- The landlord must pay the tenant interest on the deposit every year, at the rate of the rent increase guideline for that year (2.1% for 2026). Landlords can use that interest to top up the deposit when the rent goes up.
Key deposit
A landlord can ask for a key, fob or access card deposit, but it must be refundable and can't be more than the cost of replacing the keys or fobs. It's returned when the keys come back.
Damage and security deposits
For rentals covered by the RTA, damage deposits, security deposits and pet deposits aren't allowed. If a tenant damages the unit, the landlord can ask them to pay, or apply to the Landlord and Tenant Board.
Post-dated cheques
A landlord can't require post-dated cheques or automatic payments. Once a payment method is agreed, it can only change if both sides agree.
When the RTA doesn't apply
If a tenant shares a kitchen or bathroom with the owner who lives in the home, the RTA generally doesn't apply, and these rules may not either. Write down what any deposit is for and when it will be returned. See renting a room in Ontario.
Tips
- Tenants: get a receipt for every payment, and never pay a deposit before seeing the place and signing a lease.
- Landlords: track the deposit and the interest each year, and apply the interest on the tenancy anniversary.