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 to move into – relocating a company is a major undertaking that ties up administrative, logistical, and financial resources. Once the last desk has been cleared out of the old office, an important financial item comes into focus: the rental deposit. Particularly 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 will the deposit be released? What documents are required? And how long can the landlord retain the money? This article serves as a guide to the process of releasing rental deposits for office and commercial space in Switzerland.
Before we talk about the release, let's take a quick look at the basics. The rental deposit, legally defined as “security” in the Swiss Code of Obligations (CO Art. 257e), serves as protection for the landlord. It covers potential claims after the end of the tenancy, primarily for unpaid rent, unpaid utilities, or damage to the rental property that exceeds normal wear and tear.
In contrast to residential leases, where the deposit is limited by law to three months' rent, there is no such upper limit in commercial lease law. The amount is a matter of negotiation and is specified in the lease agreement. The key point is that if a cash deposit has been agreed, it must be deposited in a blocked account (rental deposit account) at a bank in the tenant's name. This account is held in trust, which means that neither the tenant nor the landlord can access it without the other's consent (or a court order). This restriction is the core of the protection for both parties and the reason why the release is a formal act.
As an alternative to cash deposits, bank guarantees or rental deposit insurance 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 is dissolved instead of an account.
The entire process of releasing the security deposit hinges on a single date: the handover and acceptance of the rental property. This moment is the starting point for all subsequent claims.
After the termination of the lease and complete vacating of the premises, a joint inspection takes place with the landlord or the property management company. The aim is to inspect the condition of the property and compare it with the condition when the tenant moved in (usually documented in a handover report).
The result of this inspection is recorded in an acceptance report. This document is of great importance. It lists in detail all defects or damage found. It is essential for commercial tenants to check this report with the utmost care. A distinction is made between:
Normal wear and tear: Things such as slight discoloration on walls or minimal scratches on the floor that occur through normal use over the years. These are covered by the rent and the tenant is not liable for them.
Excessive wear and tear: Damage caused by improper use or lack of care (e.g., deep scratches in parquet flooring, damaged fixtures, installations that have not been removed professionally).
Changes to the rental property: Alterations made by the tenant. Unless otherwise stipulated in the contract, the landlord can demand that the property be restored to its original condition.
The tenant should only acknowledge defects in the report for which they actually feel responsible. In the event of disagreement, it is advisable to note a reservation directly in the report (e.g., “Signature only to confirm presence, defect X is disputed”). By signing a defect report without reservation, the tenant acknowledges that the listed defects exist and that they are liable for them.
Based on the acceptance report, there are two main ways to release the security deposit.
Scenario 1: The ideal case – agreement and immediate release
The acceptance report is “clean.” No defects are found, the ancillary costs have been paid, and there are no outstanding claims. In this case, the purpose of the security deposit has been fulfilled. The landlord is obliged to give their consent to the release of the security deposit without delay.
What needs to be done?
In order to close the rental deposit account, the bank requires a release statement. In practice, this is usually a specific bank form for closing the deposit account, which must be signed by both parties – the tenant and the landlord. The tenant submits this form to the bank, which then lifts the block and transfers the balance plus interest to an account specified by the tenant.
Scenario 2: The conflict case – the landlord retains (part of) the deposit
If the report identifies defects for which the tenant is liable, or if utility bills 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 the case of defects: The landlord must set the tenant a deadline for remedying the defects. If the tenant fails to comply or if it is not reasonable for them to remedy the defects (e.g., in the case of specialist work), the landlord has the repairs carried out. They must present the tenant with the invoices or at least detailed cost estimates. The landlord may only retain from the security deposit the amount that is exactly necessary to cover the reported damage. It is not permissible to retain the entire amount for minor damage.
In the case of outstanding ancillary costs: This is 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 portion of the deposit to cover the amount likely to be owed (based on the previous year's statements). However, they may not block the entire deposit if only a few hundred francs in additional utility costs are expected to be owed. In both cases (damage or utility costs), the following applies: The landlord must release the undisputed portion of the deposit immediately.
This is often the biggest point of contention. The answer depends on the situation.
If there are no defects: As mentioned above, the landlord must release the deposit immediately after the handover if there are no claims. In practice, this means within a few days or weeks, not months.
In the case of defects or outstanding ancillary costs: The landlord may retain the deposit (or parts thereof) for as long as is “reasonable” to clarify his claims. In practice, deadlines of two to three months are often considered reasonable for obtaining quotes and carrying out repairs. In the case of complex commercial renovations, this may take longer, but must be justified. For the utility bill, the landlord must wait for the period specified in the contract or by law (usually 6-12 months after the end of the billing period).
The one-year period: The law (OR Art. 257e para. 3) offers tenants important protection against endless delaying tactics: one year after the official termination of the tenancy, the tenant can request the release of the deposit from the bank, even without the landlord's consent, provided that the landlord has not asserted any legal claims against the tenant during this period.
In summary, the question of the necessary steps and documents can be answered as follows:
In normal cases (agreement): You need the bank's closure form, signed by you (the tenant) and the landlord (or the property management company).
After one year (no agreement, no lawsuit): You need proof of the end date of the rental agreement (e.g., confirmation of termination or old rental agreement) and must declare to the bank that one year has passed since the end of the rental period and that no legal action has been taken by the landlord. The bank will check this and release the account after a short period of time.
In the event of a dispute (legal clarification): You will need a legally binding court decision or a payment order that orders the release in your favor.
To make the process as efficient as possible, commercial tenants should act proactively.
Preparation: Plan the final cleaning and any restoration work early on. Find the move-in report so that you have a reference point.
Communication: Agree on the inspection date in good time and in writing. Talk to the landlord if you anticipate any defects.
The inspection report: Take your time to review it. Take photos of the condition of the premises, especially any points of contention. Do not sign anything under pressure and exercise your right to reserve judgment.
Be proactive: If the report is free of defects, proactively send the bank form for termination to the landlord for signature.
Note deadlines: Make a note of the date the lease ends. Set a calendar reminder after 11 months to check the one-year deadline if the deposit is still blocked.
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