MALAYSIA Law and Practice Contributed by: Natalie Ooi and Nicholas Ooi, Ooi & Ooi
Property Transfer Tax (Stamp Duty) In addition to RPGT, stamp duty is levied on instruments of transfer for real property. The rates (as of 15 April 2025) are progressive, based on the property value, as follows: • 1% on the first MYR100,000; • 2% on MYR100,001 to MYR500,000; • 3% on MYR500,001 to MYR1 million; and • 4% on any amount exceeding MYR1,000,001. Who pays the transfer tax? The buyer is responsible for paying the stamp duty. Exemptions and reliefs Disposals without consideration between spouses, parents and children, grandparents and grandchildren are waived for the first MYR1 million in value only. Stamp duty for foreigners (individuals and com - panies) buying real estate is 4% on the property value or the purchase price, whichever is higher. 2.11 Legal Restrictions on Foreign Investors Restrictions on foreigners are provided by regu - lations that vary slightly between Peninsular Malaysia, Sabah and Sarawak. Minimum Purchase Price Foreigners can only buy real estate above a cer - tain minimum threshold, which varies by state (as of 15 April 2025), as follows: • Kuala Lumpur: MYR1 million (some areas may have different thresholds); • Selangor: MYR2 million (strata) (some areas may have different thresholds); • Penang: MYR1 million (strata) or MYR3 mil - lion (landed property on the island);
authorities is regulated by the Land Acquisition Act 1964 (LAA); see 6.22 Termination by a Third Party for the process. 2.10 Taxes Applicable to a Transaction RPGT Malaysia imposes RPGT on gains arising from the disposal of real property, including corpo - rate real estate. The RPGT rates for companies incorporated in Malaysia (as of 15 April 2025) are as follows: • disposal within three years: 30%; • disposal in the fourth year: 20%; • disposal in the fifth year: 15%; and • disposal after five years: 10%. The RPGT rates for foreigners are as follows: • disposal within five years: 30%; and • disposal after five years: 10%. The RPGT rates for local individuals are as fol - lows:
• disposal within three years: 30%; • disposal in the fourth year: 20%; • disposal in the fifth year: 15%; and • disposal after five years: 0%. Who pays RPGT?
The seller (disposer) of the property is responsi - ble for paying RPGT on the chargeable gain from the disposal of the property. Exemptions and reliefs Certain exemptions and reliefs may apply to RPGT – eg, in cases of compulsory acquisition by the government. It is advisable to consult tax professionals to assist in understanding specific exemptions.
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