Release of the rental deposit when moving out
Find out everything you need to know about the release of your rental deposit. Our guide explains when the deposit is due, what documents you need, and how long the landlord can hold onto the money.
The boxes are packed, the new commercial space is ready for occupancy – moving a company is a major undertaking that ties up administrative, logistical, and financial resources. Once the last desk has been cleared from the old office, an important financial item comes into focus: the rental deposit. Especially in commercial tenancy law, where deposits often amount to six months' rent and can quickly reach substantial sums, the smooth release of this security is of great importance for a company's liquidity.
However, the release process is not always straightforward. Questions arise: When exactly is the deposit released? Which documents are necessary? And how long may the landlord retain the money? This article serves as a guide through the process of rental deposit release for office and commercial spaces in Switzerland.
What exactly is the rental deposit and how is it secured?
Before we talk about the release, a brief look at the basics. The rental deposit, legally anchored as "security" in the Swiss Code of Obligations (OR Art. 257e), serves as security for the landlord. It covers potential claims after the termination of the tenancy, primarily for unpaid rents, unsettled ancillary costs, or damages to the rented property that go beyond normal wear and tear.
In contrast to residential tenancy, where the deposit is legally limited to three months' rent, there is no such upper limit in commercial tenancy law. The amount is negotiable and is stipulated in the tenancy agreement. Crucially, if a cash deposit has been agreed upon, it must be deposited in a blocked account (rental deposit account) with a bank, in the name of the tenant. This account is fiduciary; meaning neither tenant nor landlord can access it without the consent of the other party (or a judicial decision). This blocking is the core of the protection for both parties and the reason why the release is a formal act.
Alternatively to a cash deposit, bank guarantees or rental deposit insurance policies are also common in the commercial sector. While the release process is conceptually similar (the landlord must assert or waive their claims), the administrative procedure is different, as a guarantee rather than an account is closed here.
The decisive moment: The inspection of the rental property
The entire deposit release process hinges on a single date: the handover and inspection of the rental property. This moment is the starting point for all subsequent claims.
After termination and complete evacuation of the premises, a joint inspection with the landlord or management takes place. The aim is to inspect the condition of the property and compare it with its condition upon moving in (usually documented in a handover protocol).
The result of this inspection is recorded in a handover protocol. This document is of great importance. All identified defects or damages are listed in detail here. For the commercial tenant, it is essential to check this protocol with the utmost care. A distinction is made between:
Normal wear and tear: Things like slight discolouration on walls or minimal scratches on the floor that occur through normal use over years. These are covered by the rent, and the tenant is not liable for them.
Excessive wear and tear: Damages caused by improper use or lack of care (e.g., deep scratches in the parquet, damaged fixtures, installations not professionally removed).
Alterations to the rental property: Conversions made by the tenant. Unless otherwise contractually agreed, the landlord may demand restoration to the original condition.
The tenant should only acknowledge defects in the protocol for which they genuinely feel responsible. In case of disagreement, it is advisable to note a reservation directly in the protocol (e.g., "Signature solely to confirm presence, defect X is disputed"). By signing a defect protocol without reservation, the tenant generally acknowledges the listed defects as existing and liable.
The release process
Based on the handover protocol, there are two main ways to release the deposit.
Scenario 1: The ideal case – Agreement and immediate release
The handover protocol is "clean". No defects are found, ancillary costs have been paid, and there are no outstanding claims. In this case, the purpose of the security has been fulfilled. The landlord is obliged to give their consent for the release of the deposit without delay.
What to do?
To close the rental deposit account, the bank requires a release declaration. In practice, this is usually a specific bank form for closing the deposit account, which must be signed by both parties – tenant and landlord. The tenant submits this form to the bank, which lifts the block and transfers the balance, including interest, to an account specified by the tenant.
Scenario 2: The conflict case – The landlord retains the deposit (partially)
If defects are found in the protocol for which the tenant is liable, or if ancillary cost statements are still outstanding, the more complex part begins. However, the landlord may not arbitrarily retain the deposit. They must clearly and precisely quantify their claims.
In case of defects: The landlord must set a deadline for the tenant to rectify the defects. If the tenant fails to do so, or if rectification by the tenant is not reasonable (e.g., for specialized work), the landlord will arrange for the repairs. They must present the tenant with the invoices or at least detailed cost estimates. From the deposit, they may only retain the amount strictly necessary to cover these documented damages. A blanket retention of the entire sum for minor damage is not permissible.
For outstanding ancillary costs: A common reason for delays. Often, the final ancillary cost statement for the last period is not yet available at the time of handover. The landlord is entitled to retain a reasonable part of the deposit to cover the estimated amount still owed (based on previous year's statements). However, they may not block the entire deposit if only a few hundred francs in additional ancillary costs are expected. In both cases (defects or ancillary costs), the landlord must immediately release the undisputed portion of the deposit.
How long may the landlord retain the deposit?
This is often the biggest point of contention. The answer depends on the situation.
1. In case of no defects
As mentioned, the landlord must release the deposit immediately after the inspection if no claims exist. In practice, this means within a few days or weeks, not months.
2. In case of defects or outstanding ancillary costs
The landlord may retain the deposit (or parts thereof) for as long as is "reasonable" to clarify their claims. For obtaining quotes and carrying out repairs, deadlines of two to three months are often considered appropriate in practice. For complex commercial renovations, this can take longer but must be justified. For the ancillary cost statement, they must await the deadline stipulated in the contract or by law (usually 6-12 months after the end of the billing period).
3. The one-year period
The law (OR Art. 257e para. 3) offers the tenant important protection against eternal delaying tactics: One year after the official termination of the tenancy, the tenant can demand the release of the deposit from the bank, even without the landlord's consent, provided the landlord has not legally asserted any claim against the tenant during this period.
What do I need to close a rental deposit account?
In summary, the question of the necessary steps and documents can be answered as follows:
In the normal case (agreement): You need the bank's account closing form, signed by you (tenant) and the landlord (or management).
After one year (no agreement, no lawsuit): You need proof of the tenancy end date (e.g., termination confirmation or old tenancy agreement) and must declare to the bank that one year has passed since the tenancy ended and no legal steps have been initiated by the landlord. The bank will review this and release the account after a short period.
In case of dispute (judicial clarification): You need a legally binding court decision or an order for payment that mandates the release in your favour.
Checklist for a smooth deposit release
To make the process as efficient as possible, commercial tenants should act proactively.
Preparation: Plan final cleaning and any dismantling work well in advance. Retrieve the move-in protocol to have a reference point.
Communication: Arrange the inspection date in good time and in writing. Seek dialogue with the landlord if you anticipate defects.
The handover protocol: Take your time for the inspection. Photograph the condition of the premises, especially disputed points. Do not sign anything under pressure and exercise your right to make a reservation.
Act proactively: If a defect-free protocol is available, proactively send the bank form for account closure to the landlord for signature.
Note deadlines: Note the end date of the tenancy agreement. Set a calendar reminder after 11 months to check the one-year deadline if the deposit is still blocked.