Why is stamp duty required for a lease agreement?

LHDN stamp service
2024年11月14日 单位
Why is stamp duty required for a lease agreement?
CONZLAB BERHAD, Penny Lim

Stamping Duty Video Description 

What is stamp duty?

Stamp duty is like a special tax we call Stamp Duty. 
It's a tax on different types of papers, like legal, business, and money papers. Whenever we do important transactions like selling, giving away, or borrowing money, we have to put a special stamp on the papers, and that's what we call stamp duty. 

Why does a rental agreement need stamp duty? 

1: A rental agreement is a special paper that has legal powers. It lists all the things the tenant and landlord agreed on before the tenant moves in. 

2: Since there are no strict rules for homes in Malaysia right now, this agreement is super important to protect the landlord and the tenant.

3: In the agreement, it says clearly what the tenant has to pay for, like water, electricity, and garbage fees. The landlord can also avoid any legal responsibility for these expenses.

4: The agreement has to get a stamp from the Inland Revenue Board (LHDN) to be okay in court. Paying stamp duty is the very last thing you do when signing the rental agreement.

5: There will be two copies of the agreement – one for the landlord and one for the tenant. Both copies need a stamp to be a legal paper.

Stamp duty rates for rental agreements: 

1: One-year lease 
If the annual rent is over RM2,400, RM1 is charged for every RM250.
If the annual rent is below RM2,400, no stamp duty is charged.

2:  1-3 years lease
For annual rent above RM2,400, RM2 is charged for every RM250. 
If the annual rent is below RM2,400, no stamp duty is charged.

3:  Lease exceeding three years
For annual rent above RM2,400, RM4 is charged for every RM250.
If the annual rent is below RM2,400, no stamp duty is charged.

4:  Both copies of the documents need to be stamped – one for the landlord and one for the tenant. 
The stamped copy of the lease agreement costs RM10.


Why is stamp duty required for a lease agreement?
CONZLAB BERHAD, Penny Lim 2024年11月14日
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