When you pay a deposit you are paying a percentage of the price of a product or service. Paying a deposit shows that you intend to buy the item or service. It means you are entering into a contract with the business. When you pay a deposit, you and the business agree:
- the exact product or service that you are buying
- the deposit amount
- when the balance has to be paid
- the date that the product or service will be provided
When you buy something online or on your doorstep the business must provide you with the terms and conditions that apply to deposits. If you buy in a shop you should always check the conditions that apply to a deposit.
When can I ask for a refund of my deposit?
You have a right to ask for your deposit back when the business cannot meet their obligations to you as set out in consumer law. This includes if the business:
- cannot give you the item or service you agreed to buy
- did not deliver the product to you on the agreed date and you cannot agree a new delivery date
- did not deliver the product on the new agreed delivery date
If the business refuses to return your deposit, you can take legal action to get your deposit back. If your claim is less than €2,000, you can use the Small Claims procedure.
If I change my mind about buying the item or service, can I get my deposit back?
Generally, a business does not have to refund a deposit if you change your mind. However, change of mind cancellations may be allowed under some terms and conditions. You should read the terms and conditions to see if a refund is possible.
What happens if the shop goes out of business?
If you pay a deposit and the shop goes out of business, it may be very difficult to either get the item or get your deposit back. If the business goes into liquidation or receivership you become a creditor. Other creditors such as staff, the Revenue, banks etc are likely to take priority over you in terms of payments.
You should always try to pay a large deposit using a debit or credit card. This means you may be able to request a chargeback if something goes wrong.
Last updated on 28 November 2022