Tenancy Agreement Stamping Calculation Malaysia

Tenancy Agreement Stamping Calculation in Malaysia: A Guide for Landlords and Tenants

In Malaysia, tenancy agreements are required to be stamped by the Inland Revenue Board (LHDN) within 30 days of signing. This is to ensure the agreement is legally binding and enforceable in court.

Stamp duty for tenancy agreements in Malaysia is calculated based on the rental amount and the duration of the tenancy. Here is a breakdown of the calculation:

1. Rental Amount

The stamp duty payable is based on the total rental amount stated in the tenancy agreement. This includes all rental payments for the entire duration of the tenancy.

2. Duration of Tenancy

The duration of the tenancy is also taken into consideration when calculating stamp duty. The longer the tenancy, the higher the stamp duty.

Below is a table that shows the stamp duty rates for tenancy agreements in Malaysia:

Tenancy Period Stamp Duty Rate

Less than 1 year RM 1 for every RM 250 of rental

1 year to less than 3 years RM 2 for every RM 250 of rental

3 years or more RM 3 for every RM 250 of rental

For example, if the monthly rental amount is RM 1,500 and the tenancy period is 2 years, the stamp duty payable for the tenancy agreement would be calculated as follows:

RM 1,500 x 24 months = RM 36,000 (total rental amount)

RM 36,000 ÷ RM 250 = 144 (number of units)

144 x RM 2 = RM 288 (total stamp duty payable)

It is important to note that the stamp duty must be paid by the party who is responsible for preparing the tenancy agreement. This is usually the landlord, but can also be the tenant in some cases.

Failure to stamp the tenancy agreement within 30 days of signing can result in a fine of up to RM 250. Additionally, the agreement may not be admissible as evidence in court.

In conclusion, understanding the tenancy agreement stamping calculation in Malaysia is crucial for both landlords and tenants. By following the proper procedures and paying the correct stamp duty, both parties can ensure that their tenancy agreement is legally binding and enforceable.

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