How much deposit can a landlord ask for and when must it be returned?
No law in Malaysia sets the amount of a residential rental deposit or the period for returning it. The tenancy agreement and the Contracts Act 1950 decide it. Market practice is a two-month security deposit and a half-month utility deposit. Disputes up to RM5,000 can be claimed yourself at the Small Claims Court without a lawyer.
Does the law set the amount of a rental deposit?
No. The Residential Tenancy Act proposed by KPKT was still being finalised in August 2026 and has not been tabled in Parliament [6]. The Minister said in February 2026 that it was at its final stage [7].
Until that act is in force, the deposit amount, deductions and return period are decided by the tenancy agreement and the Contracts Act 1950 [4].
How much deposit is usually asked for?
Common market practice is a security deposit of two months' rent, one month's advance rent and a utility deposit of half a month [8]. An access card or key deposit is usually between RM50 and RM100 [8].
This is practice, not a legal limit. The amount agreed in the tenancy agreement is what applies.
What can be deducted from a deposit?
Under the Contracts Act 1950, a party that suffers loss from a breach of contract is entitled to compensation for that loss [4]. If the agreement names a specific amount for a breach, only reasonable compensation up to that amount can be claimed [4].
In practice, deduct only for losses you can prove, such as unpaid rent, unpaid bills or damage beyond normal wear and tear, and give a written reason for each deduction.
How do you claim a deposit that was not returned?
Individuals can file claims of up to RM5,000 at the Small Claims Court [1]. Neither party may be represented by a lawyer, and the decision is final and binding [2].
The claim is filed using Form 198, and the party being claimed against must file a defence in Form 199 within 14 days [2]. The filing fee is RM20 [3].
Claims above RM5,000 go to the Magistrates' Court, which hears civil claims of up to RM100,000 [1].
The jurisdiction of the Tribunal for Consumer Claims does not mention tenancies or deposits, and it does not hear claims involving an interest in land [5]. The Small Claims Court is the more certain route.
What records should a landlord keep?
Complete records shorten disputes, because the evidence for each deduction can be shown.
Frequently asked questions
Yes, if the tenant agrees, because no law sets a limit. Market practice is two months [8].
Official sources
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