kaution

Kaution, in the rental and tenancy context, is a security deposit paid by a tenant to a landlord to cover potential claims arising from breach of contract or damage to the rental property beyond normal wear and tear. It is a common feature of tenancy agreements in German-speaking countries and can also appear in other rental arrangements.

In Germany, the legal framework for Mietkaution is found in the German Civil Code (Bürgerliches Gesetzbuch, BGB). The usual maximum amount is up to three months’ net cold rent (Kaltmiete) excluding utilities. The deposit can be paid in up to three installments, for example at the start of the tenancy and with subsequent rent payments. The landlord may request the deposit in a lump sum or in installments, depending on the agreement.

Holding and use: The landlord is generally required to hold the Kaution in a separate, interest-bearing account or in a way that protects the tenant’s funds. The interest earned on the deposit typically belongs to the tenant, unless a different arrangement is explicitly agreed. The landlord may offset the deposit against unpaid rent or costs for damages at the end of the tenancy, but only for legitimate claims beyond normal wear and tear. Normal repairs or ordinary depreciation are not charged against the deposit.

Return: After tenancy ends and all charges are settled, the landlord must return the remaining deposit plus any earned interest within a reasonable period, usually after a final settlement of costs, and provide an itemized statement of any deductions.

Alternatives: Tenants may opt for a Kautionsversicherung, a rental guarantee insurance, which acts as a security without tying up cash, with a premium paid by the tenant.

Overall, Kaution protects both parties by providing financial security while remaining subject to statutory rights and standard lease terms.