Nova Scotia Security Deposit Rules: A 2026 Guide for Landlords and Tenants
In Nova Scotia, security deposits are governed by the Residential Tenancies Act and its regulations — provincial law that applies to residential tenancies across the province, including the Halifax Regional Municipality (HRM). The rules are deliberately narrow: there is a hard cap on the amount, a required trust account, a short return window, and a defined process when a landlord wants to keep some or all of the money.
Several details that circulate online are out of date. The most common error is the claim that landlords must pay annual interest on deposits — they don't, and haven't since 2013. This guide sets out the current rules as of June 22, 2026, with each regulatory point tied to its primary government source.
A short summary first:
- Maximum deposit: half (½) of one month's rent — and no more, even when rent later increases [1].
- Trust account: the landlord must place the deposit in a trust account, no later than the third banking day after receiving it [2].
- Interest: the rate set under the regulations has been 0% per year since January 1, 2013 [2].
- Return: at the end of the tenancy the deposit must be returned within 10 days, unless the landlord files a security-deposit claim in that same window [3][4].
- Default to the tenant: if the landlord neither returns the deposit nor files a claim within 10 days, the deposit is awarded to the tenant [4].
What a security deposit is — and what it is not
A security deposit is money a tenant pays at the start of a tenancy that a landlord may, in defined circumstances, apply against unpaid rent or damage at the end of the tenancy. In Nova Scotia it is the only up-front deposit the Act contemplates. The legislation does not provide for separate "damage deposits," and the maximum applies to the deposit as a whole [1].
The deposit remains the tenant's money held in trust; it is not the landlord's income. That is why the Act requires it to be segregated into a trust account rather than mixed with operating funds [2].
The amount: half a month's rent, and no top-ups
A landlord may ask for a security deposit of no more than one-half of one month's rent [1]. On a unit renting for $1,800 a month, the maximum deposit is $900. The cap is tied to the rent at the time the deposit is taken.
Critically, a landlord cannot demand an additional deposit when the rent goes up [1]. If the rent rises over the course of a multi-year tenancy, the deposit stays where it started — the landlord may not "true it up" to half of the new, higher rent.
Nova Scotia separately limits how and how often rent itself can change. A landlord may increase the rent only once in any 12-month period for an existing tenant [5], and the province's temporary rent cap limits annual increases for existing tenancies to 5% through December 31, 2027 [6]. Neither of those rules lets a landlord re-open the deposit.
The trust account and the 0% interest rule
Two regulatory requirements govern how the deposit is held.
First, timing and segregation. Under the Residential Tenancies Regulations, a landlord must pay the deposit "into the landlord's trust account not later than the third banking day following the day of receipt" [2]. The deposit is held there for the life of the tenancy.
Second, interest. This is where a great deal of older guidance is simply wrong. The regulations set the interest rate the landlord must credit to the tenant, and that rate has been zero percent per annum since January 1, 2013 [2]. Section 5 of the regulations states that the landlord "shall credit interest to the tenant on the full amount or value of the security deposit on, from and after … January 1, 2013, at the rate of zero percent per annum" [2].
In practical terms: as of June 22, 2026, a Nova Scotia landlord owes the tenant the deposit back — but no accrued interest on it. Any article quoting a "1% annual" or per-day interest rate is describing a rate that has not been in effect for over a decade.
Returning the deposit: the 10-day window
At the end of a tenancy, the landlord must return the security deposit within 10 days of the termination of the lease [3][4]. If the landlord intends to keep some or all of the deposit — for example, to cover unpaid rent or damage beyond ordinary wear — the landlord must, within that same 10-day window, file a security-deposit claim rather than simply withholding the money [4].
The consequence of inaction is decisive: "If a landlord fails to either return the security deposit or submit the form to retain the deposit within 10 days of the termination of tenancy, the security deposit will be awarded to the tenant" [4]. The 10-day clock is the operative deadline for the landlord; missing it forfeits the ability to make a claim against the deposit.
When a landlord wants to keep part of the deposit
Nova Scotia modernized its security-deposit process in 2024, introducing online forms for deposit claims through the Residential Tenancies Program [4]. The two forms most relevant to deposits are:
- Form R — Security Deposit Claim Form, which a landlord files to keep some or all of a tenant's deposit (for example, for unpaid rent or damage) [7].
- Form S — Application to the Director to return a security deposit, which a tenant can file to recover a deposit a landlord has not returned [8].
A claim does not let a landlord keep money automatically. The claim is reviewed under the Residential Tenancies Program, and a tenant who disputes it can have the matter decided by the Director of Residential Tenancies. Deductions are limited to genuine obligations such as unpaid rent or damage beyond normal wear and tear; ordinary wear, routine cleaning, and pre-existing conditions are not chargeable to the deposit.
Because the burden of documenting a claim falls on the landlord, the practical discipline is the same on both sides of the lease: a dated, signed condition report at move-in and move-out, supported by photographs, is the evidence that decides most disputes. Keep records of the lease, the deposit, and any correspondence.
The 2025 legislative changes — context for the deposit rules
Nova Scotia amended the Residential Tenancies Act and Regulations effective April 30, 2025 [9]. Those amendments did not raise the deposit cap or restore interest; they tightened other parts of the landlord–tenant relationship — shortening the arrears-eviction timeline, adding clearer grounds for a landlord to end a tenancy (such as repeated late payments or extraordinary damage), allowing victims of domestic violence to end a lease with one month's notice and no penalty, and barring tenants from subletting for more than their own rent [9].
For deposits specifically, the rules above — the half-month cap, the trust account, 0% interest, and the 10-day return — remain the governing framework as of June 22, 2026.
Why deposit discipline matters at the building scale
For a single unit, the deposit is a few hundred dollars. For a purpose-built rental building, the same rules apply per unit, and the trust-account and return obligations scale with the number of tenancies. That is one of many operating realities a development needs to underwrite before a building is ever framed — alongside the larger questions of what a parcel can support and what it costs to build.
Those upstream questions are where the real money sits, and where official figures — not a single quoted price — are the honest reference. As a development firm, Helio works from primary cost benchmarks rather than a flat per-unit number. CMHC's Housing Design Catalogue (Halifax basis, Q1 2025) estimates hard construction cost for small multi-unit buildings of roughly $223–$345 per square foot, and on a per-unit basis roughly $217,000–$387,000 per unit depending on building type [10]. Those are hard costs only: they include the general contractor's overhead and profit but exclude land, financing, soft costs, and developer profit, and CMHC advises adding a 5–10% contingency [10]. Any all-in number that omits those exclusions understates the real cost of building.
What a given parcel can hold is the other half of the equation. Under HRM's June 2024 Housing Accelerator Fund reforms, at least four dwelling units are permitted as-of-right on every centrally serviced residential lot [11], and in the Regional Centre the ER-3 zone permits up to eight units per lot (lot-size dependent), at a maximum building height of 11 metres plus a 3-metre pitched-roof exemption [12]. The deposit rules in this guide apply to every one of those units once they are tenanted — but the development decision is made long before, when the parcel's by-right capacity and the cost to build it out are weighed against the rents the market will bear.
Quick reference
| Rule | Requirement (as of June 22, 2026) | Source |
|---|---|---|
| Maximum deposit | ½ of one month's rent; no additional deposit when rent increases | [1] |
| Trust account | Deposit into trust account by the 3rd banking day after receipt | [2] |
| Interest | 0% per year (since January 1, 2013) | [2] |
| Return window | Within 10 days of lease termination | [3][4] |
| Landlord keeps deposit | Must file a security-deposit claim (Form R) within 10 days | [4][7] |
| If landlord misses 10 days | Deposit awarded to the tenant | [4] |
| Tenant recovery | Application to the Director (Form S) | [8] |
A note on getting this right
Security-deposit rules are precise and the consequences of getting them wrong fall mostly on the landlord — a missed 10-day deadline forfeits a valid claim, and a deposit "topped up" on a rent increase is an overcharge. Tenants and landlords should rely on the Residential Tenancies Program's own forms and guidance, and on the Act and regulations themselves, rather than on second-hand summaries. The province's Residential Tenancies Program is the venue for any dispute that cannot be resolved between the parties.
Sources
- Government of Nova Scotia — Security Deposit Policy: Residential Tenancies. https://www.novascotia.ca/documents/security-deposit-policy-residential-tenancies
- Residential Tenancies Regulations, ss. 5 (interest) and 10 (trust account) — Residential Tenancies Act (Nova Scotia). https://novascotia.ca/just/regulations/regs/rtgenrl.htm
- Government of Nova Scotia — Residential tenancy forms (Residential Tenancies Program). https://www.novascotia.ca/residential-tenancy-forms
- Government of Nova Scotia News Release — New Online Forms for Security Deposit Claims (July 17, 2024). https://news.novascotia.ca/en/2024/07/17/new-online-forms-security-deposit-claims
- Standard Form of Lease Regulations, Clause 14 — Residential Tenancies Act (Nova Scotia). https://novascotia.ca/just/regulations/regs/rtsflease.htm
- Government of Nova Scotia — Rent Cap Facts (5% cap through December 31, 2027). https://novascotia.ca/residential-tenancies-tenants-and-landlords/docs/rent-cap-facts-en.pdf
- Government of Nova Scotia — Security Deposit Claim Form (Form R): Residential Tenancies. https://beta.novascotia.ca/security-deposit-claim-form-form-r
- Government of Nova Scotia — Application to Director to return a security deposit (Form S). https://www.novascotia.ca/application-director-return-security-deposit-form-s
- Government of Nova Scotia — Residential Tenancies Program: Legislative Changes (effective April 30, 2025). https://www.novascotia.ca/residential-tenancies-program-legislative-changes
- Canada Mortgage and Housing Corporation — Housing Design Catalogue: Construction Cost Estimate Summary (Atlantic), Halifax basis, Q1 2025. https://assets.cmhc-schl.gc.ca/sites/housing%20catalog/resources/hdc-construction-cost-estimate-summary-atlantic-en.pdf
- Halifax Regional Municipality — Recent changes to planning documents for housing (Housing Accelerator Fund). https://www.halifax.ca/about-halifax/regional-community-planning/housing-accelerator-fund/urgent-changes-planning-0
- Halifax Regional Municipality — ER Zones Fact Sheet (June 2024), Regional Centre Established Residential zones. https://cdn.halifax.ca/sites/default/files/documents/about-the-city/regional-community-planning/er-zones-fact-sheet-june-2024.pdf