Tenancy Agreements in Malaysia (2026): Stamp Duty Calculation, LHDN e-Stamp and State-by-State Differences

Stamp duty on a Malaysian tenancy agreement is calculated under Item 49(a) of the First Schedule to the Stamp Act 1949 on a rate-per-RM250 basis that varies with lease duration. Since 1 January 2025, when the Finance Act 2024 (Act 862) removed the previous RM2,400 annual rent exemption, the full annual rent is chargeable from the first ringgit. For a RM2,000-per-month flat on a one-year lease, the duty is now RM96 — a small but legally significant sum that, if unpaid, renders your agreement inadmissible in court. Here is exactly how to calculate it, stamp it online, and handle the Sabah and Sarawak position.

How stamp duty is calculated under the Stamp Act 1949

The Stamp Act 1949 governs the stamping of instruments across Malaysia. The charging provision for tenancy agreements falls under Item 49(a) of the First Schedule to that Act, with rates set by lease duration. Effective 1 January 2025, the Finance Act 2024 (Act 862) removed the RM2,400 nil-band exemption that previously applied to low-rent agreements, and introduced a RM10 minimum duty per instrument.

The current rate schedule (per RM250 or part thereof of annual rent) is:

| Lease duration | Rate per RM250 of annual rent | |---|---| | Up to 1 year | RM1 | | More than 1 year up to 3 years | RM3 | | More than 3 years up to 5 years | RM5 | | More than 5 years | RM7 |

Step through it for a concrete example. A tenant pays RM2,000 per month on a one-year lease. Annual rent = RM24,000. Divide by RM250 = 96 units × RM1 = RM96 stamp duty.

For the same RM2,000 monthly rent on a two-year lease, the rate rises to RM3 per RM250. Annual rent = RM24,000 ÷ RM250 = 96 units × RM3 = RM288 stamp duty. The tiered structure means a two-year tenancy costs significantly more to stamp than a one-year tenancy at the same rent — a point many landlords and tenants miss when budgeting.

One recurring error: underreporting rent to reduce the duty base. Courts look at the totality of payments when determining what constitutes "rent," so undeclared service charges or maintenance fees can be folded in by the Collector of Stamp Duties.

Using the LHDN e-Stamping portal

The Lembaga Hasil Dalam Negeri (LHDN, Inland Revenue Board) operates the MyStamp portal at stamps.hasil.gov.my. Since 2019, e-Stamping has been the primary channel for residential tenancy agreements, replacing most counter transactions.

The process runs like this:

1. Register for a MyTax account at mytax.hasil.gov.my if you do not already have one.
2. Log in to MyStamp and select "Stamp Duty Assessment."
3. Choose the instrument type — "Tenancy/Lease Agreement" — and enter the parties' details, commencement and expiry dates, and monthly rent.
4. The portal computes the duty automatically. Review the assessment figure before proceeding.
5. Pay via FPX (online banking). Accepted banks include Maybank, CIMB, Public Bank, and RHB, among others.
6. Download the digital stamp certificate. Print and attach one copy to each original of the agreement.

The stamping must be done within 30 days of the agreement being executed (signed). Missing this window attracts a late-stamping penalty under section 47A of the Stamp Act 1949, as amended by the Finance Act 2024 (Act 862) effective 1 January 2025: RM50 or 10% of the unpaid duty (whichever is higher) if stamped within three months of the prescribed deadline, rising to RM100 or 20% if the delay exceeds three months.

MyStamp also accepts "voluntary disclosure" stamping of older agreements, though the penalty still applies to the delay period.

Sabah and Sarawak: administrative differences under the same Act

The Stamp Act 1949 was extended to Sabah and Sarawak in 1989 and applies across all of Malaysia. The same duty rates, the same 30-day stamping window, and the same admissibility rule under section 52 apply whether your property is in Kuala Lumpur or Kota Kinabalu.

The practical difference is administrative. Collection and administration in Sabah and Sarawak are handled through local LHDN offices rather than the peninsular branch network, and e-Stamping via MyStamp (stamps.hasil.gov.my) extends to both states through the same national portal. If you have a property in Sabah or Sarawak, the MyStamp workflow described above applies — verify with the local LHDN office if you encounter any system-level issue, but the substantive law is federal and uniform.

One point worth confirming directly with LHDN is whether any state-level administrative orders affect the stamping process for instruments relating to Sabah or Sarawak land titles specifically, as land administration in those states has some constitutionally distinct features. For straightforward residential tenancies, however, the federal Stamp Act 1949 framework operates without material difference across all Malaysian states.

Agent versus DIY stamping

Real estate agents in Malaysia often bundle stamping into their service fee, which covers preparing the agreement using a standard form, computing the duty, and lodging the stamp on behalf of the parties. Agents are typically licensed under the Valuers, Appraisers, Estate Agents and Property Managers Act 1981 (Act 242) and are familiar with the MyStamp workflow.

The cost of going through an agent is not the stamp duty itself — that sum is fixed by statute — but the professional fee, which is negotiable and varies from roughly RM200 to RM500 depending on the complexity of the agreement and the rental value.

DIY stamping on MyStamp is straightforward once you have a MyTax account and a properly drafted agreement. The platform's duty calculator removes the arithmetic risk. The main DIY pitfall is a poorly drafted agreement: courts have dismissed tenancy claims where the document lacked essential terms such as the exact premises description, the commencement date, or the security deposit amount. A solid, jurisdiction-specific template drafted against Malaysian requirements — such as the one at forms-legal.com's Malaysia tenancy agreement — reduces that risk considerably.

Key clauses that affect stampability

Not every document labelled a "tenancy agreement" is the same thing in law. Under section 5 of the National Land Code 1965 (Act 56 of 1965), a "lease" in the strict sense requires a memorandum of lease registered with the land registry and exceeds a specific threshold term. A "tenancy" is an unregistered shorter-term arrangement — typically three years or less — and does not need land registry endorsement, only stamping.

The distinction matters because a registered lease carries indefeasibility against third parties under the Torrens system; a stamped tenancy does not. Most residential arrangements in Malaysia are tenancies, not leases in the registered sense, and the stamp duty computation under the Stamp Act 1949 applies to them directly.

Clauses that affect the duty amount:

• Rent-free periods. If the landlord grants three months rent-free at the start of a 12-month agreement at RM2,000/month, the agreement might record the "rent" as RM2,000 but with an effective concessionary period. LHDN typically computes duty on the contractual rent, not the net rent after concessions, unless the agreement itself reduces the stated figure.
• Option to renew. An option clause does not by itself attract additional duty. If the option is exercised and a fresh agreement signed, that new instrument requires its own stamp.
• Furniture and appliances. Rental of furnished premises: the duty is on the rent for the premises. A separately identified sum for furniture rental is generally excluded from the rent figure, but the document must clearly separate these amounts or LHDN may treat the total as rent.

Common mistakes and how to avoid them

Splitting into multiple agreements to stay below RM2,400. The Stamp Act's anti-avoidance provisions allow the Collector to treat connected instruments as a single instrument and assess duty on the combined amount. This approach carries risk.

Printing multiple originals without stamping each. Every original of an agreement must be separately stamped. A photocopy of a stamped original is not an admissible stamped copy of the instrument; the original must be produced in proceedings.

Relying on the agent's copy. Agents sometimes retain the stamped original. Tenants are entitled to one stamped original; confirm this before signing and before handing over the deposit.

Missing the 30-day window. The clock starts on the date of the last signature, not the date the tenancy commences. If parties sign on different days, use the later date.

What an unstamped agreement costs you in court

Section 52 of the Stamp Act 1949 is unambiguous: an instrument that should be stamped but is not cannot be admitted in evidence in civil proceedings, and no authority may act on it, unless the Collector certifies a penalty has been paid. A landlord who relies on an unstamped agreement in an eviction case, or a tenant who claims back a deposit using one, faces the immediate procedural obstacle of having the document excluded by the court. Paying the duty and penalty at that point does allow admission, but it has already cost time and credibility.

Stamping is not bureaucratic box-ticking. The RM96 or RM288 in duty (for a one- or two-year tenancy at RM2,000 per month under 2026 rates) is cheap insurance against the agreement being functionally worthless when it matters most.