Within 10 days of a tenant giving up possession of the rental premises, a landlord must deliver a statement of account and any remaining balance of the security deposit to the tenant. Deliver means the statement of account and security deposit must be postmarked or personally delivered within 10 days of the tenant moving out.
If a landlord requires more time to determine how much needs to be deducted (i.e. a contractor needs to provide a quote), a landlord can deliver an estimated statement of account within 10 days and a final statement of account within 30 days.
Landlords need to make reasonable attempts to return the security deposit and statement of account to the tenant. Landlords should make efforts to get a forwarding address from the tenant when the tenancy ends. If a forwarding address cannot be obtained, the landlord must mail the security deposit / statement of account to the tenant’s most recent mailing address (most likely the address of the rental premises).
Unclaimed Security Deposits
If a landlord has taken reasonable efforts to deliver the security deposit but has been unsuccessful, a landlord has to take the following steps.
Note: These steps only apply to security deposits over $250. This procedure applies to security deposits that landlords have attempted to deliver from September 1, 2008 onwards.
Step One: Keep the security deposit and related records
If a landlord could not successfully return a tenant’s security deposit, the landlord must continue to keep the security deposit in the trust account and maintain a record of the security deposit.
Under the Residential Tenancies Act (RTA), landlords are required to keep a record of the following information:
- Date the security deposit was received from the tenant and the amount of the security deposit
- Date the security deposit was deposited into the trust account
- Name and location of the financial institution where the landlord holds the trust account
- Interest payable and paid to the tenant over the course of the tenancy
- Description of what happened to the security deposit when the tenant gave up possession (statement of account, when the security deposit was returned to the landlord if the landlord could not deliver it)
The RTA states that landlords have to keep these records for at least three years after the tenancy ends. In the case of an unclaimed security deposit, records will need to be kept significantly longer.
Step Two: Create a list of unclaimed security deposits that are abandoned
On an annual basis, landlords should make a list of all unclaimed security deposits that become “presumed abandoned” under the Unclaimed Personal Property and Vested Property Act.
An unclaimed security deposit is presumed abandoned five years from the final Statement of Account delivery deadline. For example, if a tenant moved out on March 31, 2010 and the security deposit went unclaimed, it would be presumed abandoned on April 10, 2015 – the date by which the statement of account and balance of security deposit had to be delivered to the tenant. If the landlord didn’t deliver the final statement of account until 30 days passed, the presumed abandoned date would be April 30, 2015.
In the fall of each year, landlords should review their records to determine if any unclaimed security deposits will become presumed abandoned by December 31 of that year. Landlords should make a list of all security deposits that will become abandoned during the calendar year.
Step Three: Send letters to tenants with presumed abandoned security deposits
Landlords must send letters to the last known address of all tenants who have unclaimed security deposits (it is possible this will be the address of the rental premises associated with the security deposit). The letter must give clear instructions on how the tenant can claim the security deposit from the landlord and a deadline date for claiming it. A good rule of practice is for letters to be sent by the beginning of November with a claim deadline date of December 31.
If any security deposits are claimed by the deadline date, landlords should remove those tenants’ names from their list of presumed abandoned deposits.
Step Four: Send report of all abandoned security deposits to the Alberta Government
Landlords must submit a report of all presumed abandoned security deposits to the Alberta Government’s Tax & Revenue Administration (TRA) department. The report must be submitted within 120 days of the end of the calendar year. In other words, a list of all security deposits presumed abandoned in 2015 must be reported by April 2016.
Reports can be submitted online by going to www.unclaimedproperty.alberta.ca.
Step Five: Transfer security deposits to the Alberta Government
Within 30 days of submitting their reports to the TRA, landlords must transfer the unclaimed security deposit funds to the TRA.
Step Six: Retain records for 10 years
Landlords must keep records of unclaimed security deposits for 10 years after submission to the TRA.