As a foreigner looking to rent a property in Malaysia, you may come across a term called “stamping fee” during the process of signing a tenancy agreement. This fee is essentially a tax that you have to pay to legally validate your tenancy agreement.
So, what is the Malaysia stamping fee for tenancy agreements exactly? Let`s take a closer look.
What is the purpose of the stamping fee?
The stamping fee is a tax imposed by the Malaysian government on all formal documents that require legal validation. In the case of tenancy agreements, the stamping fee serves as proof that the agreement has been registered with the relevant authorities and is legally binding.
How much is the Malaysia stamping fee for tenancy agreements?
The stamping fee for tenancy agreements in Malaysia is calculated based on the duration of the tenancy and the rental amount. The current fee structure is as follows:
– For agreements with a rental amount of less than RM2,500 per month: RM1 for every RM250 of rental amount or part thereof, subject to a maximum fee of RM100.
– For agreements with a rental amount of RM2,500 or more per month: RM2 for every RM250 of rental amount or part thereof, subject to a maximum fee of RM2,000.
For example, if your tenancy agreement has a monthly rental amount of RM3,000 and a duration of 12 months, the stamping fee would be calculated as follows:
RM2 per RM250 of rental amount x 12 (duration of tenancy) = RM96
When do I need to pay the stamping fee?
The stamping fee must be paid within 30 days of the execution of the tenancy agreement. Failure to pay the stamping fee within the stipulated time frame may result in a penalty fee of up to 10 times the original amount.
It`s worth noting that the stamping fee is typically the responsibility of the tenant, although this can be negotiated between the parties involved.
How do I pay the stamping fee?
The stamping fee can be paid at any Inland Revenue Board (LHDN) branch or online via the Stamp Duty Assessment and Payment System (e-SD). To pay the fee online, you will need to register for an e-SD account and provide the necessary details of your tenancy agreement.
In conclusion, the Malaysia stamping fee for tenancy agreements is an important aspect of renting a property in the country, as it serves as proof of the agreement`s legality. While the fee may seem like an additional cost, it ensures that your tenancy agreement is legally binding and protects your rights as a tenant.