Security Deposit and Refund in Pakistan
Reviewed by the Commoner Law editorial team. Sources: pakistancode.gov.pk, Punjab/Sindh/KP/Balochistan provincial codes, Supreme Court of Pakistan, FBR, EOBI, SBP, NEPRA, OGRA, PMDC, FIA, and provincial Healthcare Commissions. Provincial variations cite Punjab/Sindh/KP/Balochistan Acts and ICT-specific ordinances. Written in plain English with everyday Urdu legal terms (FIR, qabza, khula, NTN, CNIC) for a general audience — this is educational content, not legal advice. Our editorial standards
What is this right?
Security deposits — sometimes called "pugree" in older lease arrangements — are capped under each provincial Rented Premises Act. Punjab and KP cap them at two months' rent. Sindh's 1979 Ordinance is silent on a hard cap but limits non-refundable advances. ICT's 2001 Ordinance puts the cap at one month.
The deposit is refundable on vacating, less:
- Verifiable damage beyond ordinary wear and tear (a hole in the wall, broken fixtures — not normal paint fade).
- Outstanding utility bills the tenant didn't pay.
- Genuine arrears of rent.
The Punjab and KP Acts require refund within 30 days. If the landlord delays, the tenant can apply to the Rent Controller for recovery with interest. Some landlords run a "non-refundable" deposit scam — these clauses are unenforceable to the extent they exceed the statutory cap.
When does it apply?
- You are paying or being asked for a security deposit.
- You are vacating and the landlord is delaying or refusing the refund.
- The landlord is making deductions you believe are excessive or fabricated.
What to do if your security deposit is withheld
- Get the deposit amount in writing in the tenancy agreement, with a clause specifying it's refundable on vacating less verified damages.
- Take dated photos and a video walkthrough on the day you take possession — every wall, fixture, fitting. These are your defence against fabricated damage claims.
- Pay the deposit by bank transfer, not cash. The bank record is your proof of amount.
- On vacating, do another walkthrough video and obtain a signed handover note from the landlord listing any agreed deductions.
- If refund is delayed, send a 14-day demand notice. After that, file an application before the Rent Controller for recovery with interest under the provincial Act.
What should you NOT do?
- Don't pay deposit in cash without receipt. Cash payments are easy to deny.
- Don't accept a "non-refundable" deposit clause. It's unenforceable to the extent it exceeds the statutory cap.
- Don't vacate without a signed handover. Once keys are returned without documentation, deductions become very hard to challenge.
- Don't wait years to claim. Limitation under the Punjab Act is 1 year for refund applications; longer in civil court but harder to prove.
Frequently asked questions
Can the landlord ask for 6 months' rent as deposit?
No. Punjab and KP cap deposits at 2 months' rent; ICT at 1 month. Anything above is unenforceable, and the Rent Controller can order refund of the excess.
Can the deposit be used to pay last month's rent?
Only if the tenancy agreement says so or the landlord agrees. Otherwise, it's a separate refundable amount, and you must pay rent for the last month and recover the deposit on vacating.
Can the landlord deduct for repainting?
For ordinary repainting after normal wear: no. For repainting needed because of significant damage (graffiti, smoke staining, holes): yes, with documentation. The tenant has the right to inspect itemised invoices.
When does security deposit and refund apply?
You are paying or being asked for a security deposit.You are vacating and the landlord is delaying or refusing the refund.The landlord is making deductions you believe are excessive or fabricated.
My landlord won't return my security deposit — what do I do in Pakistan?
Get the deposit amount in writing in the tenancy agreement, with a clause specifying it's refundable on vacating less verified damages.Take dated photos and a video walkthrough on the day you take possession — every wall, fixture, fitting. These are your defence against fabricated damage claims.Pay the deposit by bank transfer, not cash. The bank record is your proof of amount.On vacating, do another walkthrough video and obtain a signed handover note from the landlord listing any agreed deductions.If refund is delayed, send a 14-day demand notice. After that, file an application before the Re...
What mistakes should I avoid with security deposit and refund?
Don't pay deposit in cash without receipt. Cash payments are easy to deny.Don't accept a "non-refundable" deposit clause. It's unenforceable to the extent it exceeds the statutory cap.Don't vacate without a signed handover. Once keys are returned without documentation, deductions become very hard to challenge.Don't wait years to claim. Limitation under the Punjab Act is 1 year for refund applications; longer in civil court but harder to prove.