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Security Deposit and Indexation: Adjustment for Inflation and Rent Increase

Learn the rules for indexation of the security deposit to inflation: calculation, procedure, and maximum limits according to the Dutch Civil Code (BW) and CPI.

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Can the security deposit be indexed?

Yes, the security deposit may be adjusted annually for inflation pursuant to Article 7:249 of the Dutch Civil Code (BW), provided this is stipulated in the rental agreement. This adjustment follows the Consumer Price Index (CPI) published by Statistics Netherlands (CBS).

Calculation Method

Formula: New deposit = Old deposit × (New CPI / Old CPI). Example: Deposit of €1000, CPI increases from 120 to 125: new deposit €1041.67.

Procedure for Adjustment

  1. Send timely written notification including the calculation.
  2. The tenant pays the difference; the landlord manages the amount in a blocked account.
  3. Upon termination of the lease, the deposit is refunded based on the adjusted amount.

Disputes and Limits

The security deposit may never exceed twice the monthly rent (statutory maximum). If this limit is exceeded, the tenant may claim a reduction. The Rent Tribunal reviews indexation adjustments.