Property Law in Malaysia: Stamp Duty for Transfer of Property
Property Law in Malaysia: Stamp Duty for Transfer of Property

Property Law in Malaysia: Stamp Duty for Transfer of Property

Effective from 01.01.2019, the rate of stamp duty payable for transfer of properties in Malaysia is calculated as follows, whether with monetary consideration (i.e. by way of sale and purchase) or without monetary consideration (i.e. by way of gift or love and affection). This is in pursuant to Stamp Act 1949, as amended by the Finance Act 2018 which came into effect from 01.01.2019. The only difference with the previous rate of stamp duty as seen in our article on Property Law in Malaysia: Perfection of Transfer is that there will be 4% of stamp duty impose on any amount of the value of properties in excess of RM1,000,000 as compare to the previous 3%. 

ItemStamp Duty RateAmount (RM)
First RM100,000(Property Value) x 1%x
RM100,001 to RM500,000(Property Value) x 2%x
RM500,001 to RM1,000,000(Property Value) x 3%x
RM1,000,001 & above(Property Value) x 4%x
Total Stamp Duty Payablex

The net effect is there will be an increase in the stamp duty payable for transfer of properties valued above RM1,000,000.

Be that as it may, the government has made the following orders for stamp duty exemptions or remissions for the benefit of certain group of the house buyers, especially the first time house buyers, which includes:-

Stamp Duty (Exemption) (No. 6) Order 2018 (P.U. (A) 377) 

– all stamp duty chargeable for transfer of property worth not more than RM300,000 is remitted provided that it is 1st property purchased is for residential purpose and the sale and purchase agreement is signed in between 01.01.2019 until 31.12.2020. 

Stamp Duty (Exemption) (No. 4) Order 2018 (P.U. (A) 321) 

– all stamp duty chargeable on any loan agreement to finance the purchase of property worth not more than RM300,000 is remitted provided that it is 1st property purchased is for residential purpose and the sale and purchase agreement is signed in between 01.01.2019 until 31.12.2020.

Stamp Duty (Remission) Order 2018 (P.U. (A) 320) 

– all stamp duty chargeable on any loan agreement to finance the purchase of property worth in between RM300,000 to RM500,000 is remitted provided that it is 1st property purchased is for residential purpose and the sale and purchase agreement is signed in between 01.07.2019 and 31.12.2020. This order, however, shall only be effective from 01.07.2019 onward.

Stamp Duty (Exemption) (No. 7) Order 2018 (P.U. (A) 378) 

– all stamp duty chargeable for transfer of property worth in between RM300,000 to RM1,000,000 is remitted provided that it is 1st property purchased is for residential purpose and the sale and purchase agreement is signed in between 01.01.2019 until 30.06.2019 for purchase of property directly from a property developer.

Stamp Duty (Remission) (No. 2) Order 2018 (P.U. (A) 376) 

– despite the increase of the stamp duty payable for transfer of properties valued above RM1,000,000, the government had ordered that 1% of stamp duty chargeable on transfer of property valued above RM1,000,000 but not exceeding RM2,500,000 to be remitted provided that the instrument of transfer be stamped on between 01.01.2019 and 30.06.2019 and the value of the property must be in excess of RM1,000,000 but not exceeding RM2,500,000. In another word, the stamp duty for the value of the property in excess of RM1,000,000.00 until RM2,500,000.00 is maintained at 3%.

Stamp Duty (Remission) Order 2019 (P.U. (A) 49) 

– a total of RM5,000 of stamp duty chargeable for transfer of property worth in between RM300,000 to RM500,000 is remitted provided that it is 1st property purchased is for residential purpose and the sale and purchase agreement is signed in between 01.07.2019 until 31.12.2020. This order, however, shall only be effective from 01.07.2019 onward.

Transfer between parents and child, and spouses

Stamp Duty (Remission) (No. 7) Order 2002 (P.U. (A) 434) 

– this is a ministerial order which provides for the remission of 50% of stamp duty chargeable on any instrument of transfer of immovable property between parents and child, and spouses. This order had since been in effect from 01.01.2003.

– However, it has now been revoked by Stamp Duty (Remission) (No. 2) Order 2019 (P.U. (A) 369). The latter remission order sought to provide the same remission but to confine it to Malaysian citizens only as the transferee.

Stamp Duty (Exemption) (No. 10) Order 2007 (P.U. (A) 420) 

– this is another ministerial order which provides for full exemption of stamp duty chargeable on any instrument of transfer of immovable property between spouses. This order had since been in effect from 08.09.2007, superseded P.U. (A) 434 in terms of stamp duty chargeable on the instrument of transfer of property between spouses.

National Home Ownership Campaign 2020 (“HOC 2020”)

This was reintroduced as part of the several incentives to stimulate the property market under the Pelan Jana Semula Ekonomi Negara (PENJANA) due to COVID-19 crisis.

Stamp Duty (Exemption) (No. 3) Order 2020 (P.U. (A) 216) 

– all stamp duty chargeable on any loan agreement to finance the purchase of property worth in between RM300,000 to RM2,500,000 (after 10% discount by property developer) is exempted provided that it is the purchase of residential property under the HOC 2020/2021 and the sale and purchase agreement is dated in between 01.06.2020 until 31.05.2021 for purchase of property directly from a property developer. This exemption, however, shall only be applicable with the HOC 2020/2021 Certification issued by REHDA, SHAREDA or SHEDA.

Stamp Duty (Exemption) (No. 4) Order 2020 (P.U. (A) 217) 

– a total of up to RM24,000 stamp duty chargeable on transfer of property worth in between RM300,000 to RM2,500,000 (after 10% discount by property developer) is exempted provided that it is the purchase of residential property under the HOC 2020/2021 and the sale and purchase agreement is dated in between 01.06.2020 until 31.05.2021 for purchase of property directly from a property developer. This exemption, however, shall only be applicable with the HOC 2020/2021 Certification issued by REHDA, SHAREDA or SHEDA.

Rent-to-Own Scheme

Stamp Duty (Exemption) (No. 4) Order 2019 (P.U.(A) 394) 

– stamp duty for instrument of transfer is exempted, in respect of residential property value not more than RM500,000, purchased as 1st property and under this financing scheme under the Government of Malaysia; regulated by the National Housing Department, Ministry of Housing and Local Government.

About the author: 

This article is written by Chia Swee Yik, Partner of this Firm (+6016 2148 218, chia@chialee.com.my) (assisted by paralegal, Ooi Zhuang Hong) who has provided practical advice on property transaction.

Feel free to contact him if you have any queries.

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