Renting in Penang (2026): Tenancy Agreement Stamp Duty, Deposits and a Tenant Checklist

Renting a condo, a landed house or a room in Penang is usually quicker than buying, but the tenancy agreement still has real costs and rules. This guide explains how stamp duty on a tenancy agreement works in Malaysia in 2026, who pays it, how self-assessment stamping changed things, and what to check before you sign.

This is general information, not legal or tax advice. Check the latest position with LHDN (the Inland Revenue Board of Malaysia) or a lawyer before you rely on it.

Step 1: Choose the area before the unit

Penang areas feel very different. Gelugor and Bukit Jambul suit people working or studying near the universities, the Bayan Lepas industrial zone or the airport. Batu Ferringhi is a beach area on the north coast. The mainland, Seberang Perai, usually means a longer commute to the island.

Visit at the times you will actually travel. Check traffic on your route, parking, food options and whether the building has the facilities you need.

Step 2: Check who you are dealing with

If an agent shows you the unit, ask for their registration number. Real estate agents in Malaysia must be registered with the Board of Valuers, Appraisers, Estate Agents and Property Managers (LPPEH / BOVAEP), and you can check a name or number on the board's public register [5].

If you deal with the owner directly, ask to see proof of ownership, such as the title or the latest assessment bill, before you pay anything.

Step 3: Agree on deposits in writing

Malaysian law does not set one fixed deposit amount for residential tenancies. Deposits are agreed between landlord and tenant and written into the agreement.

Make sure the agreement states clearly:

• How much the security deposit and the utility deposit are
• When and how the deposits are refunded at the end of the tenancy
• What deductions the landlord may make, for example for damage or unpaid bills
• Whether a booking or earnest deposit is refundable if the deal does not go ahead

Always get a receipt for every payment.

Step 4: How stamp duty on a tenancy agreement is calculated

A tenancy agreement is an instrument that must be stamped under Item 49 of the First Schedule to the Stamp Act 1949 [1]. Duty is charged on the annual rent, for every RM250 or part of RM250, at a rate set by the length of the tenancy [1][2].

These rates apply from 1 January 2025 [2]:

Tenancy term	Duty for every RM250 of annual rent (or part)
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

The Finance Act 2024 also introduced a minimum duty of RM10 for each instrument [2]. The old rule that exempted the first RM2,400 of annual rent no longer appears in the new Item 49, so an older calculator that deducts RM2,400 is out of date [2][6].

Step 5: Two worked examples

These examples use the rates in the table above. They are illustrations, not quotes.

A condo at RM1,800 a month. The annual rent is RM21,600. Divided by RM250, that is 86.4, which rounds up to 87 units.

• One-year tenancy: 87 x RM1 = RM87
• Two-year tenancy: 87 x RM3 = RM261

A room at RM600 a month. The annual rent is RM7,200. Divided by RM250, that is 28.8, which rounds up to 29 units.

• One-year tenancy: 29 x RM1 = RM29

Each duplicate copy of a properly stamped agreement is charged RM10 [4].

Step 6: Who pays the stamp duty

Under the Stamp Act, the tenant is responsible for the duty on the original agreement, and the landlord for duty on the copy [1]. In practice the agreement often says who pays what, so read that clause before you sign.

Step 7: Self-assessment stamping since 1 January 2026

Tenancy and lease agreements were in Phase 1 of LHDN's Stamp Duty Self-Assessment System (STSDS), which started on 1 January 2026 [3]. The person paying the duty, or an appointed agent, now:

1. Needs a Tax Identification Number (TIN)
2. Logs in to the MyTax portal
3. Uploads the agreement and fills in the STSDS form
4. Works out the duty and pays it within the deadline
5. Keeps the agreement and related records for 7 years

The declaration is treated as assessed when it is submitted [3]. That means a wrong calculation is the payer's responsibility, so double-check the term and the rent you enter.

Step 8: Stamp it on time

Instruments signed in Malaysia must generally be stamped within 30 days [7]. Late stamping attracts a penalty. Under the Finance Act 2024, the penalty is RM50 or 10% of the unpaid duty, whichever is greater, if you stamp within three months after the deadline. After that it is RM100 or 20% of the unpaid duty, whichever is greater [2].

An unstamped agreement can also be hard to rely on if a dispute goes to court, so stamping is worth doing properly.

A quick tenant checklist

• Area visited at the times you will commute
• Agent's LPPEH registration checked, or owner's proof of ownership seen
• Deposit amounts, refund timing and deductions written into the agreement
• Rent, term, renewal and early termination terms read and understood
• Who pays the stamp duty agreed in writing
• Agreement stamped through MyTax within 30 days
• Photos and an inventory list of the unit taken on move-in day

Find a rental in Penang on NileHome

Looking for a place? Browse Penang homes for rent and sale on NileHome. Landlords and registered agents can list a property for free.

Related reading:

• Buying property in Penang as a first-time buyer: stamp duty guide
• Living in Bukit Jambul, Penang: area guide
• Batu Ferringhi neighbourhood guide

Sources

1. LHDN, Garis Panduan Pengenaan Duti Setem bagi Surat Cara yang Tertakluk kepada Jadual Pertama Akta Setem 1949 (Item 49 rates and who pays): https://www.hasil.gov.my/wp-content/uploads/garis-panduan-pengenaan-duti-setem-jadual-pertama-as-1949.pdf
2. Finance Act 2024 (Act 862), amendments to the Stamp Act 1949, including Item 49, minimum duty and late-stamping penalties: https://moore.com.my/taxflash/Finance-Act-2024.pdf
3. LHDN, Stamp Duty Self-Assessment System (STSDS): https://www.hasil.gov.my/en/duti-setem/sistem-taksir-sendiri-duti-setem-stsds/
4. LHDN STAMPS, FAQ (duplicate instruments under Section 12, Stamp Act 1949): https://stamps.hasil.gov.my/stamps/main/faq
5. Board of Valuers, Appraisers, Estate Agents and Property Managers (LPPEH), official website and register: https://lppeh.gov.my/
6. Richard Wee Chambers, Finance Act 2024 Amendments: The Stamp Duty Focus: https://www.richardweechambers.com/finance-act-2024-amendments-the-stamp-duty-focus/
7. PwC Malaysia, Malaysian Tax Booklet: Stamp duty: https://www.pwc.com/my/en/publications/mtb/stamp-duty.html