Rental deposit in Spain: how much is it, what is it for and when do you get it back?

The rental deposit is one of the most conflict-prone topics between landlords and tenants in Spain. According to data from the Ministry of Housing, around 30% of disputes between landlords and tenants originate here. And yet the law is clear: there is a maximum amount, a specific deadline for returning it and consequences for those who fail to comply. Knowing these rules well will save you a great deal of trouble.

What Is the Rental Deposit?

The deposit is a mandatory cash payment that the tenant hands over to the landlord at the time of signing the tenancy agreement. Its function is to guarantee the tenant's compliance with their obligations: paying the rent, keeping the property in good condition and settling any outstanding utility bills at the end of the tenancy.

It is important to emphasise that the deposit is required by law. It is not optional or negotiable: Article 36.1 of the LAU establishes that a tenancy agreement cannot be formalised without one.

How Much Is the Rental Deposit in Spain in 2026?

The deposit amount is set by law and cannot be negotiated:

• Residential tenancy: 1 month's rent. If the rent is 900 €, the deposit is 900 €. No more, no less.
• Non-residential use (commercial premises, offices): 2 months' rent.

A landlord asking for more than one month's rent as a deposit on a residential tenancy is acting illegally — unless the additional amount is formalised as an additional guarantee, which is a different legal instrument covered below.

What Is an Additional Guarantee and How Much Can It Be?

In addition to the legal deposit, the landlord may request additional guarantees — an extra cash payment, a bank guarantee or a rent insurance policy. The Housing Act of 2023 caps these additional guarantees at a maximum of two months' rent for residential tenancies of up to 5 years (or 7 if the landlord is a company).

This means that in total, the landlord can ask for the equivalent of a maximum of three months' rent: one month as the legal deposit and up to two months as an additional guarantee. Any amount above this would be abusive.

Where Is the Deposit Held?

The landlord is obliged to lodge the deposit with the body designated by each regional government (comunidad autónoma). In Andalusia, there is an important update: since 24 January 2026, the obligation to lodge the deposit with the regional authority has been abolished, although the deposit itself remains mandatory between the parties under the national LAU.

In other regions (Madrid, Catalonia, the Basque Country, Valencia…) the obligation to lodge the deposit with the regional body remains in force. Failure to do so can result in administrative fines for the landlord.

Can the Deposit Be Updated During the Tenancy?

Yes, but with conditions. During the first five years of the tenancy (or seven if the landlord is a company), the deposit is not subject to adjustment. After that point, at each renewal the landlord may ask for the deposit to be brought in line with the current rent.

Practical example: if the initial rent was 800 € and the deposit was 800 €, but at renewal the rent rises to 900 €, the landlord can ask the tenant to top up the deposit by 100 € to match the new monthly amount.

When and How Must the Deposit Be Returned?

This is the point that generates the most disputes. Article 36.4 of the LAU is clear: the landlord has one month from the handover of the keys to return the deposit to the tenant.

The clock starts from the moment the keys are handed back — not from when the tenant vacates the property, nor from when utilities are cancelled. Once the keys are returned, the month begins to run.

The standard process is as follows:

1. The tenant returns the keys and both parties inspect the condition of the property.
2. The landlord checks for any unpaid rent or damage attributable to the tenant.
3. If everything is in order, the full deposit is returned within a maximum of 30 days.
4. If there are deductions, the landlord must detail them in writing and return the remainder within the same deadline.

What Happens if the Landlord Does Not Return the Deposit Within One Month?

If the landlord fails to return the deposit within one month, the withheld amount begins to accrue the legal rate of interest in favour of the tenant from the first day of delay. In 2026, that rate is set at 3.25% per annum, equivalent to approximately 0.0089% per day.

Practical example: if the deposit was 900 € and the landlord takes two extra months to return it, they would owe the tenant around 4.50 € in interest. Not a huge sum — but the interest accumulates, and a landlord who drags their feet knows there are real financial consequences.

If the delay continues, the tenant can:

• Send a formal written claim or burofax requesting the return of the deposit.
• Use the free regional mediation service available in Andalusia and other regions.
• File a court claim for the deposit plus accrued interest. Courts consistently rule in favour of tenants when the landlord cannot justify the retention.

When Can the Landlord Keep the Deposit?

The landlord may retain part or all of the deposit only in these circumstances:

• Unpaid rent: if the tenant has outstanding monthly payments at the end of the tenancy.
• Damage to the property: damage beyond normal fair wear and tear. The landlord must justify the damage with documentation (photographs, repair invoices).
• Outstanding utility bills: unpaid electricity, water, gas or other utility bills left at the end of the tenancy.
• Early termination penalty: if the contract includes a penalty clause for early exit and the tenant has breached it.

What the landlord cannot retain under any circumstances:

• The cost of ordinary cleaning of the property.
• Natural wear and tear of materials over time and through normal use.
• Repairs that are the landlord's legal responsibility under the LAU. You can read more about this in our article on who pays for repairs in a rental property in Spain.

A Very Common Mistake: Using the Deposit to Pay the Last Month's Rent

This is widespread practice but entirely illegal. The deposit cannot be used to pay the final monthly rent. If the tenant does this, they are in breach of contract and the landlord has the right to claim those outstanding payments through the appropriate channels. The deposit exists solely to cover damage or unpaid rent at the end of the tenancy — not to offset outstanding monthly payments.

Practical Tips to Avoid Problems With the Deposit

If You Are a Tenant

• Always ask for a receipt or confirmation of the deposit payment.
• Take photographs and video of the property's condition on move-in day and keep them safe.
• Do a final inspection with the landlord before handing back the keys and sign a condition report.
• Return the keys in a documented way and keep the receipt.
• If you have not received the deposit within 30 days, put your claim in writing and keep a record of the communication.

If You Are a Landlord

• Lodge the deposit with the relevant regional body within the legal deadline (where applicable).
• Take photographs of the property's condition at the start and end of the tenancy.
• If you are going to retain part of the deposit, justify it in writing with invoices and damage documentation.
• Return the full balance within one month of the key handover to avoid interest charges and potential claims.

Frequently Asked Questions About the Rental Deposit in Spain

Can a landlord ask for two months' deposit on a residential tenancy?

No. The legal deposit is capped at one month's rent for residential tenancies. The landlord can request additional guarantees of up to two further months, but these must be formalised separately and explicitly in the contract — not as part of the deposit itself.

What happens to the deposit if the landlord sells the property during the tenancy?

The new owner inherits the obligation to return the deposit at the end of the tenancy. The sale of the property does not affect the tenant's rights regarding the deposit. You can read more about this in our article on what happens to a tenancy agreement if the landlord sells the property.

Can I claim interest if the landlord takes more than a month to return my deposit?

Yes. From day 31 after the key handover, any unreturned amount automatically accrues legal interest at 3.25% per annum (the rate in force in 2026) in the tenant's favour. You do not need to request it explicitly: the interest is generated automatically by the delay.

What happens if the landlord did not lodge the deposit with the regional authority?

In regions where the regional deposit is still mandatory, the landlord may face administrative fines. In Andalusia, since January 2026, this obligation has been removed, although the deposit itself remains enforceable between the parties.

Questions About Your Rental in Nerja or La Axarquía?

At Narixa Villas we manage long-term rentals in Nerja and La Axarquía with full professionalism, advising both landlords and tenants at every stage of the tenancy. If you have any questions about the deposit or your rights and obligations as a landlord or tenant, get in touch with us — no commitment needed.

You may also find our guide on whether a landlord can enter a rental property without the tenant's permission useful, or our article on whether a tenant can sublet a property in Spain.

Legal notice: This article is for informational purposes only and does not constitute legal advice. For any specific situation, always consult a qualified legal professional.