Deposit settlements without disputes: a manager's guide (2026)
Deposit settlements without disputes: a manager's guide
Almost always for the same three reasons: wear billed in, replacement cost instead of current value, items not broken down.
Then there are the deadlines: claims become time-barred six months after return (§ 548 Abs. 1 BGB), and for the statement itself the case law allows a reasonable review period of usually three to six months.
§ 538 BGBIn 60 seconds
The tenant is not liable for normal wear (§ 538 BGB). It does not belong in the statement.
Only the current value after a "new for old" deduction may be claimed, never the replacement cost.
Every item must be checkable: room and location, the kind of finding, a reference to the move-in and move-out records, with invoices and photos attached.
Without a move-in record that proof is hard to make out in practice, and the item is then open to challenge however sound it is.
Where operating costs are still open, a reasonable portion may be retained for longer, not the whole deposit; the interest from the separate account must also be accounted for (§ 551 Abs. 3 BGB).
What the law says
The tenant is not answerable for changes or deterioration of the property brought about by contractual use. Items that do not cross that line therefore do not belong in a deposit statement. Working translation; the German original is the binding text.
Wear and tear against chargeable damage
| Not chargeable (§ 538 BGB) | Chargeable on proof |
|---|---|
| Tracks and pressure marks in the flooring | Burn hole, deep tear, large stain |
| Yellowed or darkened wall paint | Heavy nicotine staining, scratched walls |
| Drill holes in usual numbers | Drilling into tiled splashbacks or natural stone |
| Matted sealing, fine scratches | Deep scratches from moving furniture |
| Worn silicone and sealing joints | Cracked tiles, chipped basin |
| Limescaled taps | A torn-off tap, a broken window handle |
The deadlines run in parallel: six months' limitation from return (§ 548 Abs. 1 BGB) and a reasonable review period of three to six months from the end of the tenancy.
What it means for each side
- Ask for the room, location, kind and evidence for every item.
- Check whether the current value was deducted.
- Insist on payment of the undisputed part.
- Claim the interest as well.
- Strip out § 538 BGB wear before you calculate.
- Check the evidence before you claim, without a move-in record the item is vulnerable.
- State the current value and the "new for old" deduction openly.
- Itemise per position and attach invoices and photos.
Common mistakes
The tenant is not liable for it (§ 538 BGB), the commonest reason statements fail.
What is owed is the current value; without a "new for old" deduction the item is vulnerable.
The tenant cannot see what they are being asked to pay for, and will object.
Only a reasonable portion is permitted.
What to do next
Strip out wear (§ 538 BGB).
Check the evidence: is there a move-in record that carries the item?
Establish the current value and state the "new for old" deduction.
Break it down: deposit and interest, each item with room and location and evidence, the total retained and the payout with a date.
Frequently asked questions
How long may the deposit be withheld after move-out?
§ 551 BGB sets no fixed period. Case law grants a reasonable review period, as a rule three to six months after the end of the tenancy (BGH, judgment of 18 January 2006. VIII ZR 71/05). Where a Betriebskostenabrechnung is still outstanding, a reasonable part may be retained for longer. The whole amount without justification may not.
Which items may not be charged?
Everything that is contractual wear: worn tracks in the floor covering, yellowed wall paint, drill holes in a usual number, worn silicone joints, floor seals gone matt. The tenant is not responsible for such changes under § 538 BGB; they are covered by the rent. Charging wear is the most common reason whole settlements are challenged.
Why can the replacement price not be demanded?
Because a "new for old" deduction must be applied: what is owed is the current value at the time of the damage, not the price of a new item. The shorter the remaining economic service life, the lower the compensation. Carpets are assigned roughly ten years depending on quality, up to fifteen for high-quality material. Once that life is exceeded, the claim falls away entirely.
Must the deposit earn interest?
Yes. A sum of money provided as security must be held separately from the landlord's assets and at the interest rate customary for savings deposits with a three-month notice period; the returns belong to the tenant and increase the security (§ 551(3) BGB). The interest therefore belongs in the settlement.
How should a settlement be structured?
Item by item, so the tenant can follow it: room and location, type of finding, reference to the move-in and move-out records, age of the item, the current-value calculation with the "new for old" deduction, and the amount, then the deposit plus interest, the total withheld and the payout, with a date. Attach the receipts and the relevant photos.
What if the tenant objects to the settlement?
Check the objection item by item against the same three questions on which settlements fail: is it really more than wear? Has the current value been applied? Is the six-month period of § 548(1) BGB observed? Where individual items do not survive that check, correcting early is usually cheaper than litigating.
This page gives general information as at the date shown. It does not replace legal advice on an individual case.