The deposit interest rate the BC government publishes for 2026 is 0%, so a security or pet damage deposit earns nothing for days held in 2026. But BC deposit interest is worked out year by year: a deposit held during 2023, 2024 or 2025 earned 1.95%, 2.7% and 0.95%, and that interest must be added when the deposit is returned (Residential Tenancy Act s.38(1)(c)).
This guide is for British Columbia landlords working out what to pay back at the end of a tenancy. It covers the rule in the Residential Tenancy Regulation, the published rates, worked examples, and how interest fits with deductions and the 15-day deadline.
At a glance
- 2026 rate: 0%. Published by the RTB on its deposits page.
- Recent years: 2025 0.95%, 2024 2.7%, 2023 1.95%; 2009 to 2022 were 0%.
- The formula: 4.5% below the prime rate of the Province's principal banker on January 1, compounded annually (Regulation s.4).
- Applies to both deposits: security and pet damage (s.4; RTA s.38(1)(c)).
- Interest on the full deposit, before any deductions, and never doubled (RTB; Policy Guideline 17).
BC Deposit Interest Checklist
Work out and pay the interest on a BC security or pet damage deposit at the end of a tenancy.
Get Free PDF →What is the BC deposit interest rate for 2026?
It is 0% for 2026. The Residential Tenancy Branch lists the rates for recent years on its tenancy deposits and fees page as 2026: 0%, 2025: 0.95%, 2024: 2.7% and 2023: 1.95%, and the RTB's own rate file, which feeds its deposit interest calculator, gives the same figures and shows 0% for every year from 2009 to 2022.
Those rates come from a formula, not a choice. Section 4 of the Residential Tenancy Regulation sets the interest payable on a security deposit or pet damage deposit at 4.5% below the prime lending rate of the principal banker to the Province on the first day of each calendar year, compounded annually. When prime is 4.5% or lower on January 1, the rate for that year is zero.
| Calendar year | Rate (RTB) |
|---|---|
| 2026 | 0% |
| 2025 | 0.95% |
| 2024 | 2.7% |
| 2023 | 1.95% |
| 2009 to 2022 | 0% |
| 2007 to 2008 | 1.5% |
| 2006 | 0.5% |
| 2002 to 2005 | 0% |
How do you work out the interest owed on a BC deposit?
Apply each calendar year's rate to the days the deposit was held in that year, and add the interest to the balance once a year, as the Regulation's "compounded annually" requires. The RTB's calculator compounds on each anniversary of the date the deposit was paid, so that is the method used in the examples below.
Step by step:
- Start with the full deposit and the date the tenant paid it.
- For each day held, interest accrues at that calendar year's rate divided by the days in the year.
- On each anniversary of the payment date, add the year's interest to the balance.
- Stop on the return date and add any interest accrued since the last anniversary.
Worked example: three full years
A tenant paid a $1,250 security deposit on January 1, 2023, and the tenancy ended on December 31, 2025:
- 2023 at 1.95%: $24.38, for a balance of $1,274.38.
- 2024 at 2.7% on $1,274.38: $34.41, for a balance of $1,308.79.
- 2025 at 0.95% on $1,308.79: $12.43.
- Total interest: $71.22. The landlord repays $1,321.22, less any amount the tenant agrees to in writing or an arbitrator allows.
Other examples using the RTB's method
| Deposit | Held | Interest |
|---|---|---|
| $1,000 | Sept 1, 2022 to Aug 31, 2026 | $57.07 |
| $900 | July 1, 2024 to Oct 31, 2026 | $20.85 |
| $1,000 | Jan 1 to Dec 31, 2026 | $0.00 |
The RTB also publishes a Deposit Interest Calculator on its deposits page. Use it to check your figure; for a short holding period entirely inside a 0% year, the answer is simply nothing.
When is deposit interest paid, and on what amount?
It is paid with the deposit. In BC, within 15 days after the later of the end of the tenancy and the day you receive the tenant's forwarding address in writing, you must repay the security and pet damage deposit "with interest calculated in accordance with the regulations", or apply for dispute resolution to claim against them (RTA s.38(1)).
The RTB says the landlord must calculate interest on the full amount of the deposit before returning it, before asking the tenant to agree to any deductions, and before applying to keep any of it. RTB Policy Guideline 17 adds two points:
- Interest is on the original deposit, before any deductions are made.
- Interest is not doubled. If a landlord misses the 15 days and must pay double the deposit (s.38(6)), the interest is still calculated only on the original amount. See When a BC Landlord Must Pay Back Double the Deposit.
Pet damage deposits earn interest too
Regulation s.4 covers both kinds of deposit, so a pet damage deposit earns interest at the same rates, from the date it was paid. Keep the two dates separately if the pet deposit was paid partway through the tenancy. For the rest of the deposit rules, see BC Security and Pet Damage Deposits: The Complete Landlord Guide.
Frequently asked questions
Do BC landlords have to pay interest on deposits in 2026?
For days held in 2026, the rate is 0%, so nothing accrues. But interest earned in earlier years at a positive rate, such as 2023 to 2025, is still owed when the deposit is returned.
Where does the BC deposit interest rate come from?
Residential Tenancy Regulation s.4 sets it at 4.5% below the prime lending rate of the Province's principal banker on January 1 of each year, compounded annually. The RTB publishes the resulting rate for each year.
Is interest calculated before or after deductions?
Before. The RTB says interest is calculated on the full deposit before returning it or asking for deductions, and Guideline 17 confirms interest is on the original amount.
If I have to pay double the deposit, is the interest doubled too?
No. Guideline 17 says that where double the deposit is owed, interest is calculated only on the original deposit and is not doubled.
Can the tenant and I agree that no interest is payable?
No. The RTA can't be contracted out of (s.5), and the interest is part of what s.38 requires a landlord to repay. A tenant may agree in writing at the end of the tenancy that you keep an amount for a specific liability (s.38(4)(a)).
BC Deposit Interest Checklist
Work out and pay the interest on a BC security or pet damage deposit at the end of a tenancy.
Get Free PDF →Conclusion
BC deposit interest is small, but it is not optional. Use the rate for each year the deposit was held, compound once a year from the date it was paid, calculate on the full original amount, and return it with the deposit inside the 15 days.
Keep every deposit date on record
Tenon10 tracks deposits and their return dates, so you have the amount and the day it was paid when the tenancy ends.
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