Lembaga Hasil Dalam Negeri Malaysia (LHDN) introduced the Stamp Duty Audit Framework, signalling a stronger push toward compliance and transparency in stamp duty matters.
This development reflects LHDN’s ongoing effort to modernise tax administration while closing compliance gaps, particularly in document stamping and duty payments.
What Is the Stamp Duty Audit Framework?
The Stamp Duty Audit Framework is a structured approach implemented by LHDN to:
- Review and verify stamp duty compliance
- Ensure proper stamping of legal and commercial documents
- Detect underpayment or non-payment of stamp duty
It applies to a wide range of instruments, including:
- Agreements and contracts
- Loan and financing documents
- Tenancy agreements
- Share transfer documents
Why This Matters
Stamp duty has often been overlooked compared to income tax. However, under this new framework, LHDN is expected to:
- Increase audit activities on stamped and unstamped documents
- Cross-check transactions with submitted tax data
- Identify discrepancies in declared values
Businesses and individuals who fail to comply may face:
- Penalties for late stamping
- Additional duty assessments
- Potential legal implications for invalid or insufficiently stamped documents
Key Focus Areas
Under the framework, LHDN is likely to focus on:
1. Timeliness of Stamping
Documents must be stamped within the prescribed period (typically 30 days). Late stamping may result in penalties.
- Accuracy of Duty Paid
The correct duty must be calculated based on the value stated in the document. Undervaluation can trigger audits.
- Completeness of Documentation
Supporting documents must be maintained and readily available for verification during audits.
Increased Digital Monitoring
With the expansion of LHDN’s digital systems (such as MyTax and online submission platforms), audits are becoming more data-driven.
This means:
- Faster detection of inconsistencies
- Greater reliance on electronic records
- Shorter response time required from taxpayers
✅ How to Stay Compliant
To minimise risk under the new framework, taxpayers should:
- Ensure all relevant documents are stamped promptly
- Verify stamp duty calculations before submission
- Maintain proper records and agreements
- Conduct periodic internal reviews of compliance
- Seek professional advice for complex transactions
To know more, can refer here.