Government to Enforce Stamp Duty on Employment Contracts Under New Self-Assessment System Starting 2026

The government announced the phased rollout of the Stamp Duty Self-Assessment System starting January 1, 2026. Following audits by the Inland Revenue Board (LHDN), many employment contracts were found unstamped, violating the Stamp Act 1949, which requires RM10 duty per contract. Contracts signed before January 1, 2025, are exempt from duty and penalties. Those finalized between January 1 and December 31, 2025, must be stamped by year-end to avoid penalties. From January 1, 2026, all contracts must be stamped, with penalties imposed on late compliance. Employers are urged to comply promptly.

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