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The IRBM issued a media statement on 6 June 2025, informing that the Ministry of Finance (MOF) has decided to grant a stamp duty exemption as follows:
- Contracts finalized before 1 January 2025
- exempt from stamp duty and late stamping penalties remitted
- Contracts finalized from 1 January 2025 to 31 December 2025
- subject to stamp duty, but late stamping penalties will be remitted provided the employment contracts are duly stamped on or before 31 December 2025
- Contracts finalized from 1 January 2026
- subject to stamp duty and any late stamping is subject to penalties
Further to the media statement, the IRBM has issued Frequently Asked Questions on Stamping of Employment Contract in Malaysia dated 3 July 2025 (FAQ).
The FAQ states that employment contracts fall under the Stamp Act 1949. Contracts finalized before 1 January 2025, which are exempted, may be submitted to the IRB for endorsement to receive certification of stamp duty exemption at no additional cost.
In addition, the FAQ clarifies that all types of employment contracts are subject to stamp duty. These include temporary, short-term, part-time and contract workers. Renewing an employment contract requires a separate instrument and must be stamped individually. If an offer letter is the only binding document between employer and employee, it is considered an employment contract and subject to stamp duty. If an offer letter to a trainee or intern creates an employer-employee relationship, it is subject to stamp duty. An addendum to an offer letter is subject to stamp duty. For stamping purposes, employment contracts drafted in languages other than Bahasa Malaysia or English must be accompanied by a line-by-line translation prepared by qualified translators.
The FAQ notes that unstamped instruments are inadmissible as court evidence.
Reference/Citation
Official Portal of Inland Revenue Board of Malaysia (IRBM)
https://www.hasil.gov.my/en/stamp-duty/frequently-asked-questions/
