Exemption from stamp duty for specified instruments executed between 1 March 2020 and 31 December 2021

25 February 2021

On 25 January 2021, Malaysia’s Stamp Duty (Exemption) (No. 2) 2020 (Amendment) Order 2021 (“Amendment Order”) was gazetted and is deemed to have come into operation on 1 March 2020.

The Amendment Order amends the Stamp Duty (Exemption) (No. 2) Order 2020 (“Order”) which stated that an instrument of loan or a financing agreement relating to the restructuring or rescheduling of a business loan or financing between a borrower or customer and a financial institution (“Relevant Instrument”), executed on or after 1 March 2020 but not later than 31 December 2020 (“Final Execution Date”) will be exempted from stamp duty (“Exemption”). The Order was deemed to have come into operation on 1 March 2020.

The main amendments under the Amendment Order are as follows:

• Paragraph 2(a) provides that the Final Execution Date has been extended to 30 June 2021.
• Paragraph 2(b) provides that the Exemption will be subject to the following terms and conditions:
  • the existing Relevant Instrument has been duly stamped under item 22 or 27 of the First Schedule to the Stamp Act 1949; and
  • the Relevant Instrument does not contain the element of additional value to the original amount of loan or financing under the existing Relevant Instrument.
• Paragraph 2(c) inserts a new paragraph 2(2A) to the Order which provides that any interest or profit accrued from the restructured or rescheduled payments does not constitute the element of additional value to the original amount of loan or financing under the existing Relevant Instrument.