Security Deposits in Nova Scotia (2026): The Cap, the Ten-Day Clock, and Form R

Most of what a Halifax landlord needs to know about security deposits is not the cap. The cap is one sentence and almost everyone gets it right. The money is lost at the other end of the tenancy, in a ten-day window that closes whether or not you were ready for it.

This guide works through the deposit in the order you actually meet it: what you may take, how you must hold it, and what has to happen in the ten days after the tenancy ends.

What counts as a security deposit

Start with the definition, because it is much wider than the phrase suggests.

Section 12(1): Where a landlord obtains from a tenant any sum of money or other value that is in addition to the rent payable in respect of the residential premises the sum of money or value is deemed to be a security deposit.

"Any sum of money or other value" does not care what you call it. A pet deposit, a key deposit, a cleaning deposit, a damage deposit and last month's rent taken at the start of a tenancy are all money in addition to the rent then payable, so all of them are deemed security deposits. That matters because of the next subsection:

Section 12(2): No landlord shall demand, accept or receive from a tenant as a security deposit a sum of money or other value that is in excess of one half of the rent per month.

Half a month, total, across everything you have collected. On a Halifax two-bedroom currently asking a median of $2,295, that caps the deposit at roughly half that number. Two separate "deposits" of a third of a month each are not two deposits; they are one deposit of two thirds of a month, which is over the cap.

The province adds a point the Act leaves implicit: a landlord cannot ask for an extra deposit if the rent is increased. A deposit set at half a month in 2022 stays where it is, even after several rent-cap increases have moved the rent.

We cover the wider version of this problem, the clauses that are void no matter what both parties signed, in the unenforceable lease clauses guide.

How the deposit has to be held

Section 12(3): a security deposit or the proceeds thereof shall be held in trust by the landlord and deposited in a trust account in a chartered bank, trust company or credit union.

The same subsection sets out what the deposit is for, and it is narrow: it "may be applied to outstanding rent or to expenses incurred in respect of damage to residential premises that is the responsibility of the tenant." Not to your time. Not to re-letting costs. Rent owing, and tenant-caused damage.

Two provisions people rarely read sit just below it and both raise the stakes:

• Section 12(13) makes an owner, partner or director of a company that owns or manages residential premises personally liable for a breach of the Act or the regulations governing security deposits. Incorporating does not put the deposit rules behind the corporate veil.
• Section 12(16) makes a violation of section 12 or section 12A an offence punishable on summary conviction, with a fine of up to five thousand dollars.

And under section 12(14), if the property is sold, foreclosed on, or passes to a receiver or trustee, the tenants' deposits are deemed transferred with it, and the new landlord becomes responsible for them. If you are buying a tenanted Halifax building, the deposits are a liability you are assuming, and they are worth reconciling before closing rather than after.

The interest rate is zero, and has been since 2013

Section 12(4) requires you to credit interest on the full deposit at the rate set by the Governor in Council by regulation. The province publishes the table:

So for any tenancy that started in 2013 or later, the interest owed is nil, and "with interest" means "with zero interest" rather than "you may skip the calculation." The exception is the long-held unit: a tenancy that began before 2013 accrues 1% for its pre-2013 years and 0% after, and Access Nova Scotia publishes a Security Deposit Interest Calculator that does the split for you.

The ten days that decide everything

This is the part worth reading twice.

When the lease terminates, section 12A gives you exactly ten days, and within them you must do one of three things.

1. Return it.

Section 12A(1): the security deposit, together with interest, must be returned to the tenant within ten days of the date of the termination of the lease.

2. Get written consent. If the tenant agrees in writing that you may apply some or all of the deposit to rent owing or to damage, that consent is what authorises you to keep it. Section 12A(2) turns on the tenant not consenting in writing, so a signed agreement at move-out settles the matter without a filing.

3. File a Form R, and serve it.

Section 12A(2): Where the landlord seeks to apply all or part of the security deposit and interest to outstanding rent or to expense incurred with respect to any damage for which the tenant is responsible and the tenant does not consent in writing, the landlord shall file a security deposit claim in the form required by the Director with the Director within ten days of the date of the termination of the lease.

The form required by the Director is Form R, the Security Deposit Claim Form. Filing it is not the whole obligation. Section 12A(4) requires the claim to be sent to the tenant as well, and it is specific about how:

• by registered mail, express post or courier to the tenant's new address, if known;
• electronically, if an electronic address for the tenant is indicated on the lease; or
• where you have neither, by registered mail, express post or courier to the next of kin address, if the lease shows one.

Note what that list rewards. A lease that carries an email address, and a move-out where you ask for a forwarding address, are what make lawful service straightforward. A lease with neither, and a tenant who has gone, is where landlords improvise and get service wrong.

What happens if you miss it

Section 12A(5): Where the landlord does not file a security deposit claim form pursuant to subsections (2) and (4) within ten days of the date of the termination of the lease, the landlord is not permitted to make an application to the Director to retain the security deposit and shall return the security deposit to the tenant.

There is no discretion in that sentence and no exception for a strong claim. Eleven days after termination, a landlord holding a deposit against $3,000 of documented, photographed, clearly tenant-caused damage has the same entitlement to the deposit as a landlord with no claim at all: none. The damage claim itself does not vanish, and it can still be pursued as an application to the Director, but the deposit is no longer the fund it is paid from.

Section 2(aa) defines "day" as a calendar day, so the ten days include weekends and holidays. There is no provision extending a deadline that lands on a Saturday or a holiday. Count them from the date the lease terminated, not from the date you finished the inspection or got the contractor's quote.

One more reason not to leave it to day nine

Section 12A(5) requires the claim to have been filed and sent, "pursuant to subsections (2) and (4)", inside the ten days. That raises a question the Act does not answer cleanly: if you put the Form R in the mail on day nine, have you sent it in time, or does it count only when it is treated as received?

It matters because of how service is treated elsewhere in the Act. Under section 15(3), a document sent by registered mail, express post or courier "is deemed to have been served on the third day after the day of mailing", and under s.15(4) an electronic document sent after four o'clock, or on a Saturday or holiday, is deemed served the next day that is neither.

We are not going to tell you those deeming rules definitely govern a s.12A(4) sending, because section 12A(4) sets out its own list of service methods and section 15(2) carves out its own exceptions, and the interaction is not spelled out. The honest answer is that it is arguable. The practical answer is that you never need to find out: a claim mailed on day three is safe on any reading, and a claim mailed on day nine is relying on the better of two interpretations to save it. Send it early, send it electronically where the lease gives you an electronic address, and keep the tracking number or the sent message.

The tenant's side: Form S

If more than ten days have passed and the deposit has not come back, the tenant's route is Form S, the Application to Director to return a security deposit. Section 12B then puts a second clock on you: where the Director cannot confirm you filed a claim, you have ten days from the date the tenant served the application to prove either that the tenant consented in writing or that you filed a Form R in time (s.12B(3)), and to serve that proof on the tenant (s.12B(4)).

If you cannot, section 12B(6) allows the Director to decide the disposition of the deposit without first investigating and attempting mediation. In practice a landlord who missed the first ten days and then cannot document the second is not really in a dispute; they are in a collection.

What actually decides a deposit claim

Assume you filed on time. What then determines whether you keep the money is almost never the law. It is evidence, and section 12A(3) sets the line the evidence has to clear:

A claim for damages from a security deposit must not include any costs associated with ordinary wear and tear of the residential premises.

Wear and tear is the tenant using the unit as a home for the length of the tenancy. Carpet worn along the hallway after four years, paint gone flat, minor scuffs and nail holes from hanging pictures: those are yours. A cracked sink, a door off its hinges, pet damage to a floor, a unit left needing a haul-away: those are the tenant's, if you can show the unit was not like that when they moved in.

Which is the whole argument for the Rental Unit Condition Report, the form the province publishes for recording a unit's condition at the start and end of a tenancy. A dated, signed, photographed report at move-in is the only thing that reliably converts "this is damage" from an assertion into a comparison. Without one, a deposit hearing becomes your recollection against the tenant's, and the burden is on the party claiming the money.

A workable move-out sequence looks like this:

1. Inspect on or immediately after the termination date, with the move-in report in hand and a camera.
2. Ask for a forwarding address and an email address, in writing, before the tenant leaves. This is what makes s.12A(4) service simple.
3. Decide within a few days, not on day nine. Quotes take time and the clock does not wait for them. An estimate is enough to file on; you do not need the final invoice to meet the deadline.
4. Either return the deposit, get written consent, or file Form R and serve it, inside ten calendar days.
5. Keep proof of service. Registered mail or courier tracking, or the sent email if the lease carries an electronic address.

Where this goes wrong most often

Notice what section 12A(5) actually penalises. It is not indifferent to the merits because the legislature thought landlords make bad claims; it draws a bright line on timing and then stops looking. So the losing case is not the landlord trying to keep money they are not owed. It is the landlord who is owed money, has the dated photographs and the move-in report, and files on day twelve because the contractor had not called back with a number. Every fact in their favour is still true on day twelve, and none of it is reachable.

The related failure is the one at the start of the tenancy: collecting "first and last" because it is normal elsewhere in Canada, which under s.12(1) and s.12(2) is simply an over-cap deposit, recoverable by the tenant, and an offence under s.12(16).

Both are calendar and process problems rather than judgment calls, which is exactly the kind of thing that stops being a risk when someone is tracking every tenancy's dates as a matter of routine.

Sources

• Residential Tenancies Act, R.S.N.S. c. 401, sections 2(aa), 12, 12A and 12B, as consolidated to 3 October 2025.
• Access Nova Scotia, Security Deposit Interest Calculator, rate table effective 1 January 2013 (0%), retrieved 7 September 2026.
• Government of Nova Scotia, Residential tenancy forms index (Form R, Form S, Rental Unit Condition Report), retrieved 7 September 2026.

This guide describes the rules as published and is not legal advice. Where a deposit dispute involves a large sum or a contested set of facts, the section numbers above are the right place to start a conversation with a lawyer, not a substitute for one.