This guide covers landlords (or head-tenants) and tenants (or sub-tenants) in a Residential Tenancy. This applies to the majority of share accommodation and residential property rental situations. To confirm it covers your situation visit What is my share accommodation situation?
In Western Australia, Bonds or Security Deposits are referred to as ‘Security Bonds’ and in administered by the Department of Commerce Bond Administrator
A Security Bond is the only form of security that a landlord can require or accept from a tenant.
Only one Security Bond can be charged for a residential tenancy agreement, regardless of the number of tenants or changes in tenants. If there are multiple tenancy agreements for different parts of the one premises, then one Rental Bond can be charged for each of those agreements.
If the weekly rent is $1,200 or less, the maximum Security Bond is the equivalent of 4 weeks’ rent.
Example: If the weekly rent is $1,100, then the maximum Security Bond is $4,400
If the weekly rent is more that $1,200, there is no maximum Security Bond.
Example: If the weekly rent is $1,500, then the landlord may charge a Security Bond of $10,000
When the tenant keeps a pet on the premises that can carry parasites potentially affecting people, the landlord may charge up to an additional $260 to the Security Bonds to cover fumigation costs.
Example: If the tenant is allowed to have an animal such as a dog or cat on the premises, then the landlord could charge any amount up to $260 in addition to the Security Bond to cover potential fumigation costs at the end of the tenancy
In share accommodation it is common to charge 2 or 4 weeks rent and some landlords may choose to charge no Security Bond.
There is no minimum Security Bond amount and the landlord can choose not to charge a Security Bond if they wish.
The Security Bond cannot be increased under any circumstances, including rent increases or damage to the property.
Certain amounts paid in rent may be taken to be a Security Bond where the rent payable decreases in the first 6 months of the tenancy. The amount taken to be a Security Bond is any rent paid that exceeds the amount that would have been paid if the lowest rate of rent had been applied for the full 6 month period.
Example: If the original weekly rent was $500, but the rent is then decreased to $400 after 3 months, the $100 amounts paid in excess of $400 during the first 3 months of the tenancy are taken to be a Security Bond
The tenant pays the landlord the Security Bond. The landlord must then lodge the entire amount of the Security Bond with the Bond Administrator along with a ‘Lodgement of Security Bond Money’ form signed by all the tenants and the landlord.
A landlord has 14 days to lodge the Security Bond with the Bond Administrator.
The landlord must also give the tenant a receipt when receiving the Security Bond. The receipt must state:
Generally, Security Deposits are paid in a lump sum by the tenant to the landlord. The tenant and landlord may alternatively agree for the Security Bond to be paid in instalments. If the bond is paid in instalments, the landlord must follow the same process as above for each instalment as it is paid.
Condition Reports record the general state of repair and condition of the property at the beginning and end of the tenancy. They must be completed by the landlord and tenant. Condition Reports are important in determining how the Security Bond should be repaid at the end of the tenancy.
Read more about Western Australia Condition Reports.
When there are multiple co-tenants under the one agreement, all co-tenants are jointly responsible for the single Security Bond. It is the responsibility of the co-tenants to exchange amounts and reimbursements between themselves to share the payment of the Security Bond as they agree.
When there is a change in tenancy under a continuing agreement, the vacating and new tenants must both sign the ‘Variation of Security Bond’ form and lodge it with the Bond Administrator. This form releases the interest of the vacating tenant in the Security Bond to the new tenant.
This means that the new tenant takes over the old tenant’s interest in the Security Bond. It is the responsibility of the vacating and new tenant to exchange amounts between themselves to cover the interest in the Security Bond.
At the end of the residential tenancy agreement, the Security Bond should be refunded to either the tenant or the landlord, depending on whether the tenant has breached the terms of the agreement.
The residential tenancy agreement must have terminated before a tenant or landlord can make an application for payment of an amount from the Security Bond.
The landlord or tenant should make an application for refund of the Security Bond within 6 months of the end of the tenancy agreement.
Property Condition Reports
Landlords are required to conduct property condition reports on the premises at the beginning of the tenancy and within 14 days of the end of the tenancy. If the landlord intends to make a claim for an amount from the Security Bond for damage to the premises, the main point of reference will be any differences between the property condition reports before and after the tenancy.
The landlord is required to supply the tenant with 2 copies of both reports. It is recommended that the tenant and landlord negotiate any disagreements over amounts claimed by the landlord. The process of refunding the Security Bond is easier and less costly when the landlord and tenant can negotiate the amounts to be paid and then jointly lodge an application.
When the tenant and landlord agree on how the Security Bond should be refunded, both parties should sign and lodge the ‘Joint Application for Disposal of Security Bond’ form.
It is recommended that the tenant and landlord check that the correct amounts are to be refunded before signing the form.
Once the Bond Administrator receives the form, the Security Bond will be repaid as requested.
Applications by a tenant or landlord individually
If the landlord and tenant cannot agree about how the Security Bond should be repaid, then either party may apply to the Magistrates Court for an order that the Security Bond be paid out.
The relevant form is ‘Form 6: Application for Disposal of Bond Money’.
Although there is no restriction, landlords will commonly claim from the Rental Bond for:
Transferring money safely
When paying your deposit, bond or rent by cash make sure you get a receipt. With modern phones this can be as simple as an SMS or email confirming the amount, date and what it is for. Keep a copy of this incase you need it later.
Never ever transfer money to a bank account outside of Australia or use a untraceable money transfer system such as WESTERN UNION. If anyone asks you to do this on any website it is likely to be a scam and you are almost guaranteed to lose your money.
If this ever happens on Flatmates.com.au report the member immediately so we can investigate and take the appropriate action.
These legal guides provide a brief summary and introduction of the laws and regulations affecting share accommodation. They do not cover all cases in all legal jurisdictions and might not apply in your specific share accommodation situation. It is important that you use this information as a guide only and seek independent Legal Advice or consult the Relevant Acts. We do not accept any liability that may arise from the use of this information.