A commercial deposit should have a defined purpose, holder, deduction standard, replenishment rule and return process. Separate security, advance rent, fit-out deposits and utility deposits in the lease and accounting records.
Which payments should be separated?
- security deposit;
- advance rent;
- fit-out deposit;
- utility deposit;
- guarantee or bank security.
What should deduction rules cover?
- unpaid rent;
- damage;
- reinstatement;
- utilities;
- documented costs.
How should return work?
- handover inspection;
- final bills;
- written statement;
- payment deadline;
- dispute process.
Where should you continue your research?
Use Commercial, Learn and the directory.
Separate every deposit in writing.
Require a signed reconciliation and supporting evidence.
Explore commercial propertyFrequently asked questions
Is a commercial deposit the same as advance rent?
No. Each payment should be identified separately.
Should deductions require evidence?
Yes. The lease should require a written reconciliation and supporting records.
What happens after assignment or renewal?
The agreement should state whether security transfers, is replaced or is returned.
Sources & References
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