ACT Rental Bond Interest: Who Keeps It?
The Territory Keeps It — Neither Party Gets a Cent
Section 28 of the Residential Tenancies Act 1997 is clear on this: all interest earned on bond money held in the ACT Revenue Office trust account is retained by the Territory. It funds tenancy administration and advice services. Neither the landlord nor the tenant has any statutory claim to the interest.
This isn't a grey area or a matter of negotiation. The bond sits in a government trust account, and the Territory keeps the interest. Any refund is the principal less agreed or ordered deductions; neither party receives bond interest.
How This Compares
The ACT's approach isn't universal across Australia. In New South Wales, for example, tenants are entitled to interest on bonds held by NSW Fair Trading (though the rate is set by regulation and has been negligible in recent years). Victoria's system is similar to the ACT — interest goes to the Residential Tenancies Bond Authority to fund operations.
The practical difference is small. On a $2,400 bond at current savings rates, the annual interest would be a few dozen dollars at most. But the legal principle matters: neither party should factor bond interest into their financial calculations for the tenancy, because neither party receives it.
Tax Implications
Since neither the landlord nor the tenant receives interest from the bond, neither party receives bond interest income. The bond principal held by the Revenue Office is not the landlord's income, and a self-managing landlord has no annual or bond-specific tax reporting duty for that principal.
Rental income, allowable deductions, and capital gains on the property remain subject to federal tax under the Income Tax Assessment Act 1997 (Cth). The held bond principal is not the landlord's income.
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What You Get Back
At the end of the tenancy, the Revenue Office disburses the bond principal (or whatever portion is agreed or ordered) via EFT. The amount disbursed is based purely on the original lodgement amount minus any agreed or tribunal-ordered deductions. Interest is never part of the refund calculation.
For the full picture of how bond refunds, deductions, and disputes work in the ACT, see our ACT Rental Bond Guide.
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