Victoria Rental Bond Maximum Amount: How the Cap Works

Charging too much bond in Victoria carries a fine of up to 60 penalty units — over $12,500 in the 2026–27 financial year. The miscalculation that trips most landlords up is surprisingly simple: confusing four weeks' rent with one calendar month's rent.

The Bond Cap Rule

Under Section 31 of the Residential Tenancies Act 1997, a rental provider cannot demand or accept a bond exceeding one calendar month's rent when the weekly rent is $900 or less.

Two exceptions allow a higher bond:

1. The weekly rent exceeds $900 per week.
2. VCAT makes a specific order permitting a higher amount (rare, usually for heritage fittings or custom furnishings).

For the vast majority of Victorian rentals, the one-month cap applies.

Why Four Weeks Is Not One Month

A calendar month contains approximately 30.44 days — not 28. Using the four-week shortcut underestimates the bond you're legally entitled to collect.

The correct formula uses the annual rent divided by 12:

Maximum bond = (weekly rent × 52) ÷ 12

Here's what the difference looks like:

At $600 per week, you'd leave $200 on the table by using four weeks instead of the statutory formula. At $900 per week, that gap reaches $300.

Fortnightly Rent? Convert First

If the rental agreement states rent fortnightly, divide by two to get the weekly rate before applying the formula. A fortnightly rent of $1,200 gives a weekly rate of $600 and a maximum bond of $2,600.

What Happens Above $900 Per Week

When weekly rent exceeds $900, the statutory cap lifts. You and the renter can negotiate the bond amount freely. In practice, landlords of high-value properties typically charge between one and two months' rent, but there's no legislated ceiling.

The Penalty for Overcharging

Demanding or accepting an excessive bond is an offence under Section 31 of the RTA. The maximum fine is 60 penalty units. At the current 2026–27 rate of $209.10 per unit, that's $12,546.

RTBA Online flags entries that exceed the calculated cap for the stated weekly rent, which catches most accidental overcharges during lodgement. But if you collect the bond directly and lodge late, there's no automatic safety net.

Bond Top-Ups After a Rent Increase

Even if rent rises during the tenancy, you cannot ask for an additional bond to match the new amount. Section 31 prohibits mid-tenancy top-ups except in two narrow situations: fixed-term agreements exceeding five years with a specific top-up clause, or VCAT-approved additional security for approved renter alterations.

If you've just increased the rent and the current bond was set at a lower rate, that original amount stands.

The Rental Bonds in Victoria guide includes a bond cap calculator worksheet and the exact formula for fortnightly and monthly rent conversions, so you can verify the number before lodging.

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