Rental deposit after six months: which deductions are allowed?

Two periods answering different questions

You have handed back the flat and paid the deposit for your new home, but your former landlord is still holding the money. Many tenants assume that six months is an absolute cut-off. That assumption can be misleading when damage to the flat is disputed.

Section 548(1) of the German Civil Code concerns the limitation of a landlord’s compensation claims for changes to or deterioration of the rented property. The six months generally start when the landlord recovers the property. This is a different question from when your deposit repayment becomes due.

For a cash deposit, the Federal Court of Justice considers the end of the tenancy, a reasonable review period and any continuing need for security. The landlord must repay once the requirements are met. The necessary review and accounting period depends on the circumstances and may exceed six months. This is not a general licence to retain every deposit for that long (BGH, VIII ZR 184/23, paragraphs 18 and 30).

Why a time-barred claim may still matter

Set-off means that mutual claims are offset against each other. Section 215 BGB permits this despite limitation if the claim was not yet time-barred when set-off first became possible. This is no general exemption: the requirements for set-off and the claims covered by the security must be satisfied.

The judgment of 10 July 2024 addressed an additional issue. A claim for property damage initially seeks restoration. The injured party can instead demand the money needed for that restoration. On the findings in this case, the landlord had only made that choice after the six months expired. The BGH did not consider set-off excluded for that reason: a standard residential cash-deposit agreement is normally interpreted as allowing set-off despite that late choice of monetary compensation (paragraphs 22 to 29 and 34 to 43).

What the BGH did not decide

The tenant sought repayment of EUR 785.51 including interest. The landlord asserted damage claims of EUR 1,175. The BGH did not award him those damages. It set aside the appeal judgment and remitted the case so that the existence of the alleged claims could be determined (paragraphs 1 to 4 and 44).

This article concerns a cash deposit for a residential tenancy after the tenancy has ended. Deposit guarantees, special repayment agreements and additional payment claims beyond the deposit require separate assessment. Service charges and redecoration obligations likewise cannot be resolved solely by this judgment. The decision dates from 2024; it is not a new October 2026 ruling.

Deductions worth examining closely

Our practical assessment: do not respond to an accounting merely by saying “time-barred”. Examine each item. What damage is alleged? Did it already exist when you moved in? What does the handover report say? How is the amount justified? The possibility of set-off does not establish a claim or resolve those factual questions.

Under section 538 BGB, tenants are not responsible for wear caused by contractual use. Whether a particular mark is normal wear or compensable damage requires examination of the condition and circumstances. Make any objection as specific as possible and support it with relevant photographs or documents.

How to prepare a repayment request

Ask for a comprehensible deposit accounting and identify the disputed items. Request payment of the amount no longer needed to secure legitimate claims. Keep your request and evidence that it was received. Our recommendation is to weigh the recoverable amount, the evidence and the cost risk together before starting court proceedings.

• Tenancy agreement and precise deposit terms
• Proof of deposit payment and any accountings received
• Move-in and handover reports, photographs and return date
• Complete correspondence and evidence for each alleged item of damage