Tenancy Renewal
in Malaysia (2026 Guide)

This guide is for general information only. Stamp duty figures are based on LHDN (Inland Revenue Board) rates current as at 2026; verify the latest rates at lhdn.hasil.gov.my before stamping. WhatsApp ClickBina if your unit needs freshening up before re-signing.

Renewal options: new agreement vs extension letter

When a tenancy in Malaysia is coming to its end date, the landlord and tenant have three practical options:

The recommended best practice is always to execute a new or extension document and stamp it. An unstamped agreement is not admissible as evidence in Malaysian courts under the Stamp Act 1949 (though it can be stamped late with a penalty).

Step-by-step renewal process

1. Start 2–3 months before expiry. Give yourself time to negotiate, draft and stamp before the old agreement lapses.
2. Negotiate terms: rent amount, duration, any changes to conditions (pets, subletting, renovation, etc.).
3. Draft the new agreement or extension letter. Use a properly drafted template that covers all material terms. See the ClickBina Tenancy Agreement Template →.
4. Both parties sign. Landlord and tenant (and any guarantor) sign all copies; date the document.
5. Stamp within 30 days of signing at any LHDN counter (or via the MyStamp e-stamping portal). Late stamping is possible but incurs a penalty.
6. Update the deposit position if the rent has increased (see deposit section below).
7. Notify the utility companies if any account details have changed.

Stamp duty on tenancy renewal in Malaysia

Stamp duty on tenancy agreements (including renewals and extensions) is governed by the Stamp Act 1949. The rate for residential leases is:

• First RM2,400 of annual rent: exempt
• Every RM250 (or part thereof) of annual rent above RM2,400: RM1

The stamp duty is typically paid in equal shares by the landlord and tenant, though the agreement can specify otherwise.

Stamp duty calculation examples

Formula: Stamp duty = ROUNDUP((Annual rent − RM2,400) / 250) × RM1. Verify with the LHDN MyStamp calculator at mystamp.hasil.gov.my.

Rent review at renewal

There is no statutory rent control or cap for residential tenancies in Malaysia. Rent at renewal is freely negotiated between the parties. In practice, Klang Valley landlords typically adjust rent by:

• 0–5% for a good long-term tenant in stable market conditions (retaining a reliable tenant often beats a higher rent with an unknown one)
• 5–15% in strong rental demand areas (e.g. Mont Kiara, Bangsar, Damansara) where market rents have moved
• No increase or slight reduction if the market has softened or to retain a tenant who has been performing

Before naming a figure, check current listing prices for comparable units on the market and factor in vacancy risk. A 3-week void period on a RM2,000/month unit costs RM1,500 in lost rent — equivalent to a 6% annual increase absorbed immediately.

See our guide on how to set the right rental price in Malaysia → for market benchmarking.

Holdover tenancy — risks and legal position

If the fixed-term ends and neither party takes action but the tenant keeps paying and the landlord keeps accepting, the law implies a periodic (month-to-month) tenancy under common law. This creates several risks for the landlord:

• Reduced security: either party can end a periodic tenancy with just one month’s notice, giving you less planning certainty.
• No stamped document: if a dispute arises, there is no current stamped agreement to produce as evidence in court.
• Rent frozen at old rate: without a new agreement, there is no written basis for a rent increase.
• Outdated terms: conditions agreed years ago may no longer reflect your needs or the law.

A holdover is acceptable for 1–2 months while a renewal is being finalised, but should never become a permanent arrangement. Execute and stamp a new document promptly.

Terms to review and update at renewal

A renewal is an opportunity to tighten or modernise the agreement. Consider reviewing:

• Rent amount and due date
• Permitted use — confirm no subletting or short-term letting (Airbnb) without consent
• Pet clause — specify allowed/disallowed clearly
• Renovation and alteration clause — no structural changes without written consent
• Notice to quit period — align with your re-letting timeline
• Utility responsibility — who pays TNB, water, internet, maintenance fee
• Repair and maintenance responsibility — see our guide on landlord vs tenant repair responsibility →
• Access clause — confirm landlord’s right to inspect with reasonable notice (24–48 hours)

Cost comparison: new agreement vs extension letter

Worked example — 1-year renewal at RM2,000/month

Scenario: Existing 1-year tenancy (RM2,000/month) expiring. Landlord and tenant agree to renew for another year at RM2,100/month. New agreement signed on 1 June 2026.

How and when to give notice of non-renewal

If either party does not wish to renew, notice should be given in writing well before expiry — typically 1–2 months as stated in the agreement. Best practice:

• Give notice at least 2 months before expiry to allow time to find a new tenant or new unit.
• Non-renewal notice should state the agreement end date and confirm that the tenant is expected to vacate by that date.
• Confirm all terms of return: key handover date, joint inspection timing, deposit refund timeline.

If you are not renewing and need to prepare the unit for a new tenant, WhatsApp ClickBina early — we can often complete a turnover within 1–2 weeks.

What happens to the deposit at renewal

The security deposit carries forward unless the agreement specifies otherwise or the rent has changed:

• Same rent: the existing deposit continues to be held; no adjustment needed.
• Rent increase: if the deposit is a fixed multiple of monthly rent (e.g. 2 months), the tenant should top up the deposit to reflect the new rent. State this clearly in the new agreement.
• No formal renewal (holdover): the deposit continues to be held by the landlord under the original terms, but there is no written basis for requiring a top-up if rent increases informally. Another reason to always execute a new document.

For full deposit rules, see our security deposit guide →.

Common renewal mistakes to avoid

• Letting the tenancy lapse into holdover. Month-to-month periodic tenancy offers less security and no written basis for rent increases.
• Not stamping the new agreement. An unstamped agreement is inadmissible in Malaysian courts. Even a late stamp is better than none — stamp within 30 days to avoid penalty.
• Carrying forward outdated terms. A renewal is an opportunity to fix problem clauses; a lazy renewal that copies everything unchanged misses this.
• Forgetting the deposit top-up. If rent increases and the deposit is 2 months’ rent, the landlord needs the extra deposit amount from day one of the new term.
• No written handover at renewal. A brief joint inspection at renewal (noting condition, defects) creates a fresh baseline and reduces disputes at the end of the new term.