(Tax Update) Malaysia Stamp Duty Overhaul : Self-Assessment and Higher Penalties Part 6

(Tax Update) Malaysia Stamp Duty Overhaul : Self-Assessment and Higher Penalties Part 6

“Eh... How Would LHDN Know?” — The Self-Assessment Era Is Here

Dear Clients,

Let me share with you a very normal day at our office.

A SME boss called me — voice low, a bit nervous — and asked:

“Eh... if I don’t prepare employment contracts, how would LHDN know?”
“What if I collect rental but don’t prepare or stamp tenancy agreement?”
“I lent RM200k to my brother’s company. No agreement... can or not?”

I laughed and replied,

“Bro, IRB officers don’t live on trees anymore.”

We both laughed. But I wasn’t joking.

What is Self-Assessment?

In Malaysia, we’ve been under the Self-Assessment System (SAS) for over 25 years — for both individuals and companies.

Starting 2025, this concept now extends to Stamp Duty too.

What does that mean?

Simple:
You’re in charge.
Not IRB.
Not your secretary.
Not your tax agent.

You are expected to:

  • compute your own tax

  • claim correct reliefs and deductions

  • file the return

  • pay your tax

  • and now — stamp your documents on time

Even if no one asks.
Even if no one checks (yet).
That’s the self-assessment spirit.

How It Works (For Individuals)

Here’s a quick breakdown:

  • Calculate Income – Total up all your income for the year

  • Apply Deductions – Minus your reliefs, expenses, rebates

  • Compute Tax – Based on the latest rates

  • File Return – BE for employment, B for business

  • Pay Tax – Before deadline

Under SAS, once you file, that’s your final assessment.
If IRB audits and finds a mistake?
That’s when the headache starts.

Stamp Duty: Self-Assess Starting 2025

Same rule now applies to documents:

  • Sign employment contract → Stamp within 30 days

  • Sign tenancy agreement → Assess and stamp

  • Lend money to related party → Agreement must be stamped

No letter will come.
No warning. If you miss it, penalty applies.

Big Data + AI = No More Guessing

IRB no longer need to “check drawer.”
They just check the system.

They match your:

  • bank info

  • e-invoice data

  • CP204 filing

  • related party transactions

If numbers don’t match — red flag.
Audit will come.

E-Invoice Will Change the Game

This is not future talk — it’s already here.

With e-Invoicing, all your sales, purchases, and payments go live into LHDN’s system.

No more:

  • under-declared income

  • fake documents

  • backdated tenancy

  • “tutup mata” on director advances

Everything is digitally traceable.
Self-assessment is no longer just trust — it’s backed by tech.

Voluntary Compliance = Your Best Insurance

In this new era:

  • You keep documents for 7 years

  • You act before LHDN asks

  • You don’t say “I didn’t know” in 2025

Because LHDN already knows.

PS : Authored by Mr Koh Teck Peng, the Group Principal, in his personal LinkedIn post

Past blog on Stamp Duty
16 April 2025 Malaysia Stamp Duty Overhaul : Self-Assessment and Higher Penalties
https://www.ktp.com.my/blog/malaysia-stamp-duty-self-assessment/16apr2025

16 May 2025 Malaysia Stamp Duty Overhaul : Self-Assessment and Higher Penalties Part 2
https://www.ktp.com.my/blog/stamp-act-malaysia-2024-part2/16may2025

20 May 2025 Malaysia Stamp Duty Overhaul : Self-Assessment and Higher Penalties Part 3 https://www.ktp.com.my/blog/stamp-act-malaysia-2024-part3/20may2025

21 May 2025 Malaysia Stamp Duty Overhaul : Self-Assessment and Higher Penalties Part 4

https://www.ktp.com.my/blog/stamp-act-malaysia-2024-part4/21may2025

26 May 2025 Malaysia Stamp Duty Overhaul : Self-Assessment and Higher Penalties Part 5

https://www.ktp.com.my/blog/stamp-act-malaysia-2024-part5/26may2025

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