Stamp Duty Rate for Tenancy Agreement Malaysia

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Stamp Duty Rate for Tenancy Agreement in Malaysia: What You Need to Know

When renting a property in Malaysia, tenants and landlords are required to sign a tenancy agreement. This legal document outlines the terms and conditions of the lease, including the rental amount, security deposit, and duration of the tenancy. However, it is important to note that tenancy agreements must also be stamped to comply with Malaysian law.

What is stamp duty?

Stamp duty is a tax imposed by the Malaysian government on certain legal documents, including tenancy agreements. The stamp duty is payable on the value of the agreement, which is calculated based on the total rent payable for the duration of the tenancy. The stamp duty also varies based on the location of the property and the duration of the tenancy.

Stamp duty rates for tenancy agreements

The stamp duty rates for tenancy agreements in Malaysia are as follows:

1. For a tenancy period of less than one year, the stamp duty is calculated as follows:

– Rental amount of up to RM2,500: No stamp duty payable

– Rental amount between RM2,500 and RM5,000: RM1 for every RM250 or part thereof

– Rental amount above RM5,000: RM2 for every RM250 or part thereof

2. For a tenancy period of one year or more, the stamp duty is calculated as follows:

– Rental amount of up to RM2,500: No stamp duty payable

– Rental amount between RM2,500 and RM5,000: RM2 for every RM250 or part thereof

– Rental amount above RM5,000: RM4 for every RM250 or part thereof

For example, if the monthly rent is RM3,000 and the tenancy period is one year, the stamp duty payable would be calculated as follows:

– Rental amount for one year: RM3,000 x 12 = RM36,000

– Stamp duty for RM36,000: RM2 for every RM250 or part thereof

– Stamp duty payable: RM2 x (RM36,000 / RM250) = RM288

How to stamp a tenancy agreement

Tenancy agreements can be stamped at any Malaysian stamp office or online via the Malaysian Inland Revenue Board’s e-Stamping portal. To stamp a tenancy agreement, both the tenant and landlord must sign the agreement and bring it to a stamp office or upload it onto the e-Stamping portal. The stamp duty must be paid at the same time.

Penalties for non-compliance

Failing to stamp a tenancy agreement is a punishable offence under Malaysian law. If a tenancy agreement is not stamped, it may not be admissible as evidence in court in case of disputes between the tenant and landlord. The landlord may also be fined up to RM1,000 for not stamping the tenancy agreement.

In conclusion, stamp duty is an essential part of renting a property in Malaysia. Tenants and landlords must ensure that their tenancy agreements are stamped to comply with Malaysian law. To save time and avoid penalties, it is recommended to use the e-Stamping portal for stamping tenancy agreements.

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