Security deposit not returned — Luxembourg: how to get it back

Your rights and the legal deadlines in Luxembourg

The legal framework governing residential rental deposits (garantie locative or caution) in Luxembourg is set out primarily in the amended Law of 21 September 2006 on residential leases, as substantially reformed by the Law of 23 July 2024, in force since 1 August 2024. The consolidated official text is published on Legilux.public.lu. The Ministry of Housing publishes its official explanations at logement.public.lu.

Maximum deposit amount

Since 1 August 2024, the security deposit is capped at 2 months of base rent (excluding service charges and utilities). If you signed your lease before the reform and paid a 3-month deposit, you are legally entitled to request that your landlord reimburse the difference.

The two-tranche return mechanism (post-1 August 2024)

The 2024 reform introduced a structured, two-stage return procedure. Both deadlines are strictly defined by law and trigger financial penalties if missed without valid justification:

Source: logement.public.lu — Rental lease FAQ (official English version).

Critical prerequisite: the exit inventory

The entire deposit framework depends on a properly conducted and signed état des lieux (property condition inventory). If no entry inventory was drawn up at the start of the tenancy, the landlord is legally presumed to have received the property in good condition and cannot legally retain any part of the deposit on grounds of damage. Without a comparable exit inventory, deductions are likewise extremely difficult to justify in court.

What a landlord can — and cannot — deduct

Permitted deductions

According to the official FAQ published by the Ministry of Housing at logement.public.lu, a landlord may only retain:

• The cost of repairs for damage genuinely attributable to the tenant (i.e., beyond normal wear and tear), supported by itemised invoices or verifiable quotes from third parties — a simple landlord-drafted estimate or Excel spreadsheet generally has no legal probative value;
• Unpaid rent and charges that were due and outstanding at the time of key handover.

Any deduction from the deposit must be formally justified by the landlord in writing within 1 month of key handover. If the landlord fails to communicate written justification within that month, they are legally deemed to have accepted the property's return in good condition and must refund the full deposit.

What cannot be deducted

The following cannot legally justify a deduction or a refusal to return the deposit:

• Normal wear and tear (usure et vétusté normales): minor scuff marks on walls, slightly worn carpeting in high-traffic areas, faded paint after several years of occupation, small nail holes from hanging pictures — these are expressly excluded by the law and the official FAQ at Guichet.public.lu;
• Pre-existing damage already recorded in the entry inventory;
• Damage attributable to the landlord's failure to maintain the property;
• Vague, unsubstantiated claims of damage not recorded in the exit inventory.

Late return penalties and surcharges

This is one of the most significant changes introduced by the 2024 reform. The official Ministry of Housing page (logement.public.lu — Bail à loyer) and the English-language FAQ (logement.public.lu — Rental lease FAQ) state explicitly:

Practical example: If your base rent is €1,800/month, a 3-month unjustified delay triggers an additional €540 in penalties (3 × 10% × €1,800) on top of the deposit amount owed.

Important: The penalty is not automatically paid by the landlord. You must formally demand it in writing and, if necessary, claim it before the court. The penalty applies per tranche: if both the first and second tranches are returned late without justification, the penalty clock runs separately for each.

The formal demand letter (mise en demeure): step-by-step model

Do not rely on informal messages. A proper written demand is the legally required first step before any conciliation or court procedure, and it starts the formal evidence trail.

1. Wait for the deadline to pass. Confirm that 1 month has elapsed since key handover (for the first tranche) or since receipt of the final utility statement (for the second tranche), and that no written, itemised justification was provided by the landlord.
2. Send a registered letter with acknowledgement of receipt (courrier recommandé avec accusé de réception). This is the only form of written notice that creates a verifiable legal record. Email alone is insufficient unless the landlord confirms receipt in writing.
3. Include in your letter:
   • Your full name, address and lease reference;
   • The date of the exit inventory and key handover;
   • The exact deposit amount paid and the tranche(s) not yet returned;
   • Reference to the Law of 21 September 2006 on residential leases, as amended by the Law of 23 July 2024 (Article 2bis, paragraph 5);
   • The applicable legal deadline already passed;
   • A formal demand for reimbursement of the deposit plus the 10% monthly penalty for each month of unjustified delay;
   • A new deadline of 15 days to comply;
   • Notice that failure to comply will result in referral to the Comité de Conciliation en Matière de Bail and/or the Justice de Paix.
4. Keep a full copy of your letter, the postal proof of sending, and the acknowledgement of receipt. These are your primary evidence documents.
5. If no reply within 15 days, proceed immediately to the conciliation or court step below.

Recourse: conciliation and court

Step 1 — Comité de Conciliation en Matière de Bail (free, municipality-level)

Each Luxembourg municipality has a Rent Conciliation Committee (Comité de Conciliation en Matière de Bail). This is a free, first-instance mediation body for rental disputes, including deposit recovery. You can file a claim with the committee of the municipality where the rented property is located. The committee hears both parties and attempts to reach an amicable settlement. Its decisions are binding only if both parties accept them. If the landlord refuses to participate or rejects the committee's conclusion, you must escalate to court.

Find your local municipality's contact at guichet.public.lu.

Step 2 — Justice de Paix (Magistrate's Court)

The Justice de Paix (Justice of the Peace) has jurisdiction over virtually all residential tenancy disputes in Luxembourg, regardless of the amount involved. For claims under €15,000 — which covers the vast majority of deposit disputes — the simplified procedure applies and a lawyer is not required, though legal advice is strongly recommended.

• Justice de Paix de Luxembourg — for properties in Luxembourg City and surrounding cantons: justice.public.lu
• Justice de Paix d'Esch-sur-Alzette — for properties in the south of the country
• Justice de Paix de Diekirch — for properties in the north

The competent court is determined by the location of the rented property, not your current address.

At court, you can claim: (1) full repayment of the outstanding deposit; (2) the 10% monthly penalty for each month of unjustified delay; (3) court costs.

Alternative: Service de Médiation de la Consommation

The Service de Médiation de la Consommation is a free, independent mediation body that can intervene in consumer-type disputes between landlords and tenants. It can be a useful parallel route before or alongside formal court proceedings, but it cannot impose a binding decision. More information: mediateurconsommation.lu.

FAQ

My landlord returned the deposit but deducted amounts for "painting and cleaning" with no invoices. Is this legal?

No. Under Luxembourg law as clarified by the official Ministry of Housing FAQ, any deduction from the security deposit must be justified by the landlord in writing, within 1 month of key handover, and must be supported by objectively verifiable evidence — typically third-party invoices or quotes. Legal experts cited in judicial commentary have emphasised that a simple landlord-prepared estimate or internal cost list has, in principle, no legal probative value before a court. Furthermore, if "cleaning" refers to routine end-of-tenancy cleaning, this must be assessed against the entry inventory: if the property was handed to you in a professionally cleaned state and the exit inventory reflects comparable cleanliness, a deduction is unjustified. Write to your landlord by registered post disputing each deduction line by line, requesting supporting invoices, and citing the Law of 23 July 2024. If the landlord does not respond satisfactorily within 15 days, file with the Comité de Conciliation en Matière de Bail.

My landlord says they are waiting for the annual service charge bill before returning anything. Is this correct?

Only partially. Since 1 August 2024, the law clearly splits the deposit return into two distinct tranches. The first 50% must be returned within 1 month of key handover, regardless of pending utility bills, provided all rent is paid and no damage beyond normal wear is noted. The second 50% may legitimately be withheld pending the final annual utility statement, and must be returned within 1 month of receiving it. A landlord who withholds the entire deposit — including the first tranche — while citing pending utility bills is not complying with the law, and the 10% monthly penalty on the first tranche applies from the moment the first deadline was missed.

I have no entry inventory (état des lieux d'entrée). Can the landlord still retain my deposit?

This is a strong legal position for you as a tenant. Without a signed entry inventory, the landlord has no documentary baseline to prove what condition the property was in at the start of the tenancy. Luxembourg courts and the official guidance at guichet.public.lu confirm that in the absence of an entry inventory, the landlord is legally presumed to have handed over the property in good condition — meaning they bear the burden of proving that any damage occurred during your tenancy, which is practically very difficult. You should still send a formal demand letter and, if needed, assert this argument before the Comité de Conciliation or the Justice de Paix.

How long does it take to recover a deposit through the Justice de Paix, and does it cost money?

Timeframes vary by case load and complexity, but for straightforward deposit recovery claims, the simplified procedure at the Justice de Paix can result in a hearing within a few weeks to a few months. Court filing fees (frais de justice) are generally modest for small claims (under €15,000) and no lawyer is legally required, though consulting one — even once — is advisable to structure your claim correctly, particularly if the landlord contests the deductions. If you win, the court can order the landlord to pay your legal costs as well. Free or subsidised legal aid (aide juridictionnelle) is available for eligible low-income tenants through the Barreau de Luxembourg (justice.public.lu). Do not wait: Luxembourg prescription periods for contractual claims are 10 years, but the longer you wait, the weaker your evidence position becomes.