Understanding Malaysia's Limitation Periods for Debt Recovery & Debt Collection Actions

1. Under Malaysia's Limitation Act 1953, you have six (6) years to initiate a claim for a debt owed to you.

2. This six-year period starts from when the cause of action arises, which is typically when the debt is due— for example, the date on the invoice or the expiration of any credit terms.

3. Once these six years pass, your claim becomes "time-barred."

4. However, this period can restart if the debtor makes a partial payment or acknowledges the debt, such as through a message requesting more time to pay.

SNEAKY TIPS:

For Debtors: If you owe someone money, but no action is taken by the creditor for over six years, the debt may become unclaimable.

For Creditors: If six years have elapsed since a debt was acknowledged, sending a casual message to inquire about repayment can prompt the debtor to acknowledge the debt again, potentially restarting the six-year limitation period.

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If your reminders have been ignored or you simply don’t want the hassle of chasing payments, Rule & Co is a debt recovery law firm that helps creditors recover debts via legal strategies that minimize upfront cost, maximise recovery, and safeguard your reputation.