Leases, Screening & Managing Tenants
Ontario Lease Agreement Clauses: What Landlords Can (and Can't) Include
In Ontario, first and last month's rent is the only deposit a landlord can legally collect — separate damage deposits and pet fees aren't enforceable, even if a tenant signs a lease agreeing to them, and tenants can demand that money back years later. This guide covers which lease clauses actually hold up.
In Ontario, first and last month’s rent is the only rent deposit a landlord can legally collect — a separate damage deposit or pet fee is not enforceable, even if a tenant signs a lease agreeing to it, and tenants can demand that money back years later. This guide covers which lease clauses actually hold up and which don’t.
Why a Signed Lease Clause Isn’t Always an Enforceable One
A landlord and tenant agreeing to a lease term in writing doesn’t automatically make that term legally enforceable in Ontario. Some of the most common clauses added to GTA rental agreements don’t hold up if a tenant challenges them.
Just last week, a Mississauga landlord called us in a panic. Her tenant had stopped clearing snow from the walkway — something they’d agreed to in writing. Now she was facing city fines.
Like many Toronto-area property owners, she thought having it in the lease made it enforceable. Turns out, some of the most common rental terms in Ontario aren’t worth the paper they’re written on.
Which Lease Deposits Are Legal in Ontario?
Ontario landlords can legally collect first and last month’s rent as a deposit. Additional charges like a damage deposit or a pet fee are not enforceable, no matter what the lease says.
Remember that damage deposit you collected to protect your Oakville investment property? Or the pet fee for that Hamilton duplex? Here’s the reality check every Ontario landlord needs:
- First and last month’s rent? You’re safe.
- Everything else? Not so much.
| Lease term | Enforceable in Ontario? |
|---|---|
| First and last month’s rent | Yes — the only rent deposit a landlord may legally collect |
| Damage deposit | No — not a recognized deposit type under Ontario tenancy law |
| Pet fee / pet deposit | No — landlords cannot charge a separate fee for tenants with pets |
Does a Clause Your Agent or a Lease Template Recommended Make It Legal?
No — a lease clause being common practice elsewhere, or recommended by an agent, friend, or template, doesn’t make it enforceable in Ontario. Every clause needs to be checked against Ontario’s own tenancy rules, not assumed.
“My real estate agent told me to add this clause…” “My friend who’s a landlord in Ottawa does it…” “I found this lease template online…”
Stop right there. What works in one city — or province — might get you in hot water in the GTA.
What Happens When You Collect an Illegal Deposit?
Collecting an unenforceable deposit doesn’t just risk a dispute — a tenant can demand that money back, sometimes long after they paid it. One Brampton landlord found this out the hard way, at a cost of $3,000.
Did you know that tenants can actually demand their money back if you’ve collected certain types of deposits? Even months or years later? One Brampton landlord learned this $3,000 lesson the hard way.
What Should Landlords Do Instead of Adding More Lease Clauses?
Protecting a rental investment isn’t about cramming more clauses into the lease — it’s about using the deposit structure and terms Ontario law actually allows, and getting professional guidance on the rest.
Want to know what successful landlords in the Greater Toronto Area actually do to protect their investments? It’s not about adding more clauses to a lease agreement — it’s about knowing which lease terms are actually hurting you, what experienced local landlords do instead of risky clauses, and how to stay legal while still protecting the property.
CRESI helps Greater Toronto Area landlords navigate rental agreements while maximizing their returns. Need professional property management that keeps you legal and profitable? Talk to CRESI Property Management about protecting your investment the right way.
What About a Tenant Who Passes Away During the Lease?
A landlord generally has 30 days to handle a deceased tenant’s property correctly, and letting the wrong family member into the unit during that period can create serious legal complications.
Confirm who has the legal right to deal with a deceased tenant’s belongings before granting anyone access to the unit — a family member showing up at the door isn’t automatically the right point of contact, and getting this step wrong can create legal headaches on top of an already difficult situation.