Stamp Duty on Tenancy Agreements increased effective January 1, 2025

     

Stamp duty is a tax levied on legal documents, typically involving the transfer of property or the creation of legal rights. In the context of tenancy agreements, stamp duty is charged based on the rental amount and the duration of the lease. It is essential for its enforceability in court.  

    

The new stamp duty rates will apply to all tenancy agreements executed on or after January 1, 2025. The increase is structured to reflect the rental value and the term of the lease, ensuring that higher-value agreements contribute more significantly to the tax revenue. 

      

Additionally, the previous exemption on the first RM2,400 of annual rent has been eliminated. This means that all tenancy agreements, regardless of the rental amount, will now be subject to stamp duty.

    

The increase in stamp duty on tenancy agreements marks a significant shift in Malaysia's property rental landscape. Parties should ensure that tenancy agreements are properly stamped to avoid legal complications. An unstamped agreement may not be admissible in court, which could lead to disputes over tenancy terms.