[Direct answer]How much can be refunded depends on the contract provisions. When the lease term expires and the lessee does not renew the lease, in accordance with Article 733 of the Civil Code of the People's Republic of China (effective January 1, 2021), the lessee shall return the leased property, and the lessor shall refund the deposit or return the remaining portion after settlement. The deduction of the deposit is limited to two circumstances: the deduction items explicitly stipulated in the contract, and the part that the lessee should compensate for in accordance with the law if he breaches the contract or causes losses, and both of them need to be proved by the lessor; normal wear and tear such as furniture aging and natural wall stains shall be borne by the lessor. At the time of settlement, both parties shall jointly inspect the house and make a handover list. In case of disputes, the handover records and loss evidence shall be used to determine the responsibility. For details, please refer to the Civil Code of the People's Republic of China.Legal services for real estate transactions and construction projects.

I. Problem Background and Typical Scenarios

"The lease term is over, and the landlord said that the deposit will be used to offset the cleaning fee and the depreciation fee. Is that reasonable?" Settling the deposit at the end of the lease may seem like a trivial matter, but it is actually a high-risk area for disputes. Typical scenarios include: the landlord deducting the full deposit when the tenant moves out, citing wall stains, furniture scratches, and an aging toilet; requiring the tenant to pay unpaid utilities, property management fees, and other expenses from the deposit; failing to notify the tenant of the lease termination within the contractually agreed timeframe, leading to disputes over the losses during the vacancy period; and the landlord delaying the return of the deposit on the grounds that the next tenant is moving in, or even requiring the tenant to pay for the "initial cleaning" themselves. The rules for normal settlement at the end of the lease are different from those for abnormal terminations such as group renting being investigated. The key point is to settle the deposit according to the contract and deduct it based on evidence. The process for handling related lease disputes can be referred to for reference.Legal services for real estate transactions and construction projects.

II. Key points of contention

The focus of the dispute centers on five points. First, the nature of the deposit: The deposit is a performance guarantee rather than an advance payment. After the lease terminates and the lessee settles the fees and returns the property, the lessor should refund the deposit. Second, the boundaries of deductions: Deductions that are explicitly stipulated in the contract and do not violate the law are generally valid; general deductions such as "wear and tear fees" and "depreciation fees" require specific evidence of losses to support them. Third, the distinction between normal wear and tear and intentional damage: Furniture aging, natural wall stains, and normal wear and tear of facilities are the responsibilities of the lessor; damages or losses caused by poor storage are the responsibility of the lessee. Fourth, the formalization of the handover process: Whether a joint inspection is conducted, whether a handover checklist is prepared, and whether there are video records directly determine the determination of damages. Fifth, notifications and deadlines: If the contract stipulates a notice period for vacating the premises, failure to notify may lead to disputes over losses during the vacancy period.

III. Professional analysis by Henglue Law Firm

A dispute case of pre-sale contracts for commercial housing represented by Attorney Tian Jiaoyan, although not a lease dispute, its judgment logic of "settling according to the contract" is highly consistent with the settlement of deposits. On April 30, 2021, Zhang Quan signed the "Beijing City Commercial Housing Pre-sale Contract" with Beijing A Real Estate to purchase a house at No. 302 in a certain residential community with a total price of 6,841,972 yuan, and agreed to deliver the house before June 15, 2023. On the same day, they signed a supplementary agreement, which stipulated that if the delivery was delayed, A Company would be granted a 90-day grace period during which it would not bear any liability. After the expiration of the grace period, the buyer would pay a penalty of 1/10,000 of the total price per day starting from the 91st day after the expiration of the agreed delivery period. However, A Company did not deliver the house until March 5, 2024, and the parties disagreed on whether the grace period could be cumulated with other extensions and whether the penalty standard was valid. Attorney Tian Jiaoyan argued that the grace period should be strictly applied according to the contract, and there was no contractual or legal basis for cumulating it. She also maintained that the daily 1/10,000 penalty was a true expression of the parties' intention and not illegal, and the period and amount of the penalty were in accordance with the contract. The court adopted this view and ruled that A Company should pay a penalty of 118,366.12 yuan from September 14, 2023 to March 5, 2024 and bear the litigation costs. This case highlights that where the terms are clearly defined, the court will strictly apply them according to the contract, and if the standard is valid, it will be fully supported. The same applies to the settlement of deposits at the expiration of the lease - if the deduction items and standards are clearly defined and supported by evidence, they will be implemented according to the contract; if the terms are unclear or the evidence cannot be provided, the claim will be difficult to obtain support. This case was handled by Beijing Henglue Law Firm.Tian Jia YanThe attorney (practice certificate number: 11101202111381309, subject to the certificate issued by the judicial administrative organ) acts as the agent.

IV. Practical suggestions and legal basis

The legal basis includes Article 733 of the Civil Code of the People's Republic of China (effective January 1, 2021) (Return of the leased property upon expiration of the lease term), Article 712 (Obligation of the lessor to maintain the leased property), Article 714 (Obligation of the lessee to properly maintain the leased property), Article 577 (Liability for breach of contract), Article 584 (Scope of compensation for losses), and Article 566 (Return and compensation after termination); and the currently effective regulations on housing rental management in various regions. Action list: 1. Before vacating the property, notify the lessor in advance as agreed in the contract and specify the inspection time; 2. Conduct a joint inspection of the property with the lessor, take photos or videos to record the readings of water, electricity, and gas meters and the current condition of the facilities, and prepare a written handover list signed by both parties; 3. Settle the fees for water, electricity, gas, and property management and retain the receipts; 4. For the unreturned security deposit, first send a written notice of reminder, and if unsuccessful, file a complaint or lawsuit with the relevant authorities. For more details, please refer to the following link:Legal services for real estate transactions and construction projects.

5. Henglu Law Firm's Reminder

Most disputes over security deposits upon lease expiration fail because of "lack of evidence". If the tenant does not take photos of the current condition upon moving in, fails to jointly inspect the property upon moving out, fails to settle the fees, or fails to issue a written reminder, the parties will each have their own version of the events when disputes arise, and the court will only determine the outcome based on the preponderance of evidence. Tenants should fix images at both the time of moving in and moving out, clarify the boundaries between "normal wear and tear" and "human-induced damage", and if the landlord claims to deduct the deposit, he/she should specify the specific items, amounts, and basis. Tenants can refuse to accept general deductions with unclear agreements. When handling similar cases in Beijing, it is recommended that the parties bring the contract, the handover records, and the transfer receipts as soon as possible when disputes arise, and entrust a lawyer to handle the case.Beijing Henglu Law FirmProfessional lawyers should calculate the amount to be refunded.

VI. Frequently Asked Questions

Q1: If the lease expires and the tenant does not renew the lease, must the deposit be fully refunded?

If the lessee settles the fees, returns the house properly, and there are no breaches of contract, the deposit shall be refunded in full; if there are deduction items as stipulated in the contract, or if the lessee owes unpaid rent or damages the facilities and should compensate according to law, the lessor may deduct the corresponding portion, and the remaining amount shall still be refunded. If the deduction is generalized as "wear and tear fees" or "depreciation fees" but the specific losses cannot be proven, it is generally difficult to obtain support. The amount of the refund in individual cases shall be determined based on the contract stipulations, the handover records, and the evidence of the losses.

Q2: What evidence do I need to prepare for the rental termination settlement?

The core materials are divided into four categories: 1. Contracts and evidence of performance, including lease contracts, deposit receipts, and payment receipts for rent and utilities (water, electricity, and gas). 2. Handover evidence, such as photos of the property at the time of move-in and move-out, records of utility meter readings, and a handover checklist signed by both parties. 3. Communication evidence, including written notices demanding the return of the deposit, WeChat or SMS records, and the other party's responses. 4. Defense evidence, such as objections to deductions and proof of the purchase date and lifespan of facilities. The two fixed photos taken during move-in and move-out are particularly crucial.

Q3: How much does it cost to litigate over a deposit dispute?

The litigation fees are paid in stages based on the amount of the litigation request. The amount of the deposit dispute is usually not large and the fees are relatively limited. The losing party bears the fees, and the party who wins the case partially shares the fees proportionally. For cases settled through simple procedures or mediation, the fees are collected at half the normal rate. The attorney's fees are determined through negotiation between the law firm and the client, and there is no unified government pricing. Such disputes can also be resolved first through people's mediation, complaints channels of neighborhood committees or housing and urban-rural development rental management departments, which are more cost-effective and take less time.

Q4: How long will it take to resolve the deposit settlement dispute?

The process of negotiation and complaint mediation usually takes several weeks; for litigation, the first-instance ordinary procedure is completed within six months and the summary procedure within three months. For cases with clear facts and relatively small amounts, the summary procedure is more suitable. If there are disputes over the amount of compensation for damages and an appraisal and identification are needed, the appraisal and identification period will not be included in the trial time limit, and the cycle will be extended accordingly. It is recommended to claim the refund in writing promptly after moving out to avoid delays leading to the loss of evidence or the other party's unavailability.

Q5: If the deposit is unreasonably withheld when moving out, what should I do first?

There are four steps to proceed: First, organize the contracts, handover lists, and image records, and check whether there are agreements or legal grounds for the deductions; Second, request the lessor in writing to list the deduction items, amounts, and grounds and return the remaining security deposit, and keep the delivery receipts; Third, attach the proof of payment of the fees to eliminate the defense of unpaid fees; Fourth, if no agreement can be reached, file a complaint with the people's mediation organization or the leasing management department, and if the problem is still not resolved, initiate legal proceedings in a timely manner. For disputes involving large amounts, consult a professional lawyer for calculation as soon as possible.

The above questions and answers are mainly based on the judicial practice in Beijing. There may be differences in the interpretation of the law in different regions. It is recommended to consult a professional lawyer based on the specific circumstances of the case.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, to avoid missing the statutory time limit. →Legal services for the purchase and sale of real estate·Attorney Li Yonghui·Beijing Henglue Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and publicly available adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If you encounter disputes, please consult a practicing lawyer in time.