IMPLEMENTATION OF SELF ASSESSMENT STAMP DUTY SYSTEM IN PHASES EFFECTIVE FROM 1st JANUARY 2026

This alert focuses on the implementation of Self-Assessment Stamp Duty System (Self-Assessment System”) by the amendments made to Stamp Act 1949 brought above by Measures for the Collection, Administration, and Enforcement of Tax Act 2024 (Act 863).

Effective Date 1 JANUARY 2026

Schedule of the phase implementation

Self -Assessment System will be implemented in phases based on the type of instrument as follows:-

No. Phase Effective Dae Types of Instruments
1 Phase 1 From 1 Jan 2026 Instruments or agreements related to rental or leases, general stamping and securities.
2 Phase 2 From 1 Jan 2027 Instruments of transfer of property ownership.
3 Phase 3 From 1 Jan 2028 Instruments or agreements not covered in Phase 1 and Phase 2

Key Features of Self-Assessment System are set out briefly herein

Electronic Filing

• Duty payers shall electronically file stamp duty return in the prescribed form, together with the executed instruments chargeable with duty and to specify the description of instrument, amount of duty and any other particulars as required.

• Once the return is filed, the Collector shall be deemed to have made an assessment based on the information in the return.

• However, the Collector reserves discretion to adjudicate the instrument and assess the duty payable.

Record Keeping

• Duty payers shall retain the instrument and all relevant documents for a period of Seven (7) years from the date the duty is paid.

Powers of Collector

The Collector of Stamp Duty is empowered to

• Issue a notice requiring any person to produce any documents or attend personally before him for examination.

• Search and inspect any instrument, book, account, record, document, object, article, material or things and make extracts or copied of it.

• Enter into any land, building and place for purpose of searching and inspecting the documents and records with reasonable assistance provided by its owners or occupiers.

• Issue assessment or additional assessment within Five (5) years from the date the duty was paid or without time limitation in cases involving fraud, wilful default, or negligence.

• In Peninsular Malaysia, issue a notice requiring any person to furnish a translation of the documents and records in the national language.

Offences and Penalties

The following offences, for which a person, upon conviction, will be liable to a fine of up to RM10,000: –

• Failure to comply with the notice to furnish relevant documents and records and any translation of such.

• Failure to electronically file a stamp duty return without a reasonable excuse.

• Failure to keep records.

• Obstruction or refusal to allow the Collector access to any land, building or place, and failure to provide reasonable facilities and assistance.

• Failure to comply with directions to answer any question lawfully asked by the Collector or the valuers authorised by him.

It will also be an offence if any person makes an incorrect return or gives incorrect information unless it was done in good faith. Upon conviction of the offence, the person will be liable to a fine in the range of RM1,000 to RM10,000 and a special penalty equal to the amount of unpaid duty.
Conclusion Under the Self-Assessment System, the burden of determining the correct duty will be entirely on the Duty payers. Duty payers should ensure compliance with the new Self-Assessment System to avoid offences and incurring any penalties.

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Disclaimer: This article does not constitute legal advice and is not intended to be used as a substitute for specific legal advice. Please contact us if you require legal advice or if you have specific queries.