Do you want to know the most commonly asked Stamp Duty Malaysia 2020 Questions?
It’s been one year since our Finance Minister, YB Lim Guan Eng announced the new Stamp Duty Malaysia 2019 changes. Consequently, the announcement has to affect all of us when we buy a new house from the property agent, seller, or even developer.
This stamp duty is so essential to know because you can save thousands of ringgit upfront. And if you ignored it, you might miss a chance to save some money here.
Okay, let’s be honest here.
Before buying a house, most of us will rent. When renting doesn’t make any sense anymore, and we want a home that belongs to us. Then, we will start to look for a house.
Later, when we start to research for a house, we realized that the cost of buying a home is exceptionally overwhelming — notably, the property stamp duty.
Ah, the stamp duty in Malaysia.
So, we have millions of questions to ask about stamp duty Malaysia, stamp duty calculation, and stamp duty exemption Malaysia 2020.
Here are some of the most common Stamp Duty Malaysia 2020 questions, along with the best way to answer them:
Question 1: How much is the stamp duty in Malaysia?
When buying a house in Malaysia, everyone is required to pay for Property Stamp Duty. And if you’re wondering what the scale fees looks like, do refer to the following.
The Property Stamp Duty scale is as follow.
For the first RM100,000, 1%
From RM100,001 to RM500,000, 2%
From RM500,001 to RM1mio, 3%
The subsequent amount is 4%
Even though everyone required to pay Property Stamp Duty in Malaysia, but there is an exemption of paying stamp duty for a first-time house buyer.
If you’re interested to know more about the Stamp duty exemption, continue reading this article until the end.
Question 2: How is the stamp duty calculated?
Ah. We realized that even though Property Stamp Duty scale is given, but most people still not sure on the calculation.
Afraid not. We’re going to teach you today.
Example 1,
The property Purchase Price is RM500,000.
For the first RM100,000, 1% : RM100,000 x 1% = RM1000
From RM100,001 to RM500,000, 2% = RM400,000 x 2% = RM8,000
Total Stamp Duty Payable is RM9000
Example 2,
The property Purchase Price is RM1,000,000.
For the first RM100,000, 1% : RM100,000 x 1% = RM1000
From RM100,001 to RM500,000, 2% : RM400,000 x 2% = RM8,000
From RM500,001 to RM1mio, 3% : RM500,000 x 3% = RM15,000
Total Stamp Duty Payable is RM24,000
Example 3,
The property Purchase Price is RM1,500,000.
For the first RM100,000, 1% : RM100,000 x 1% : RM1000
From RM100,001 to RM500,000, 2% : RM400,000 x 2% = RM8,000
From RM500,001 to RM1mio, 3% : RM500,000 x 3% = RM15,000
The subsequent amount is 4% : RM500,000 x 4% = RM20,000
Total Stamp Duty Payable is RM44,000
Question 3: Do you need to pay stamp duty?
Yes. Everyone that buys a house or transfer their property to another individual will need to pay Property Stamp Duty in Malaysia.
Regardless, you’re a Malaysian or Foreigner; we are paying the same Property Stamp Duty.
Unless, if you’re eligible for stamp duty exemption.
There is no such thing as foreigner paying expensive property stamp duty compared to a Malaysian.
If you’re interested to know more about the Stamp duty exemption, we have a full page devoted writing about Stamp Duty exemption.
Click the following link, if you’re interested.
Stamp Duty Calculation Malaysia 2020 And Stamp Duty Malaysia Exemption
Question 4: What’s the point of stamp duty?
Stamp Duty is revenue to the state and the federal government to run or operate the state or our country. As such, the government has made it a compulsory tax-paying when buying or transferring a house in Malaysia.
Question 5: Who pays the stamp duty buyer or seller?
The property stamp duty will be payable by the buyer, not seller.
Seller will pay Real Property Gain Tax (RPGT) if there is a profit earned from selling the property.
Question 6: Do you pay stamp duty when you buy or sell?
You pay stamp duty when you buy or transfer a house. You don’t need to pay stamp duty when selling a house.
When you sell a house, you might need to pay for Real Property Gain Tax (RPGT) if there is a profit earned from selling the property.
Question 7: How is registration and stamp duty calculated?
For stamp duty calculation, please refer to Question 1 & 2 above.
Registration fee is a fee charged by the land office or the state. It’s varied from one state to another.
For example,
Kuala Lumpur registration fee is RM100, regardless of property price and value.
And Selangor registration fee is based on the property value and the scale as below.
Starting from RM 50,000 and below – RM50.00
From RM 50,001 to RM 200,000 – RM200.00
Next for the RM 200,001 to RM 500,000 – RM400.00
Next RM 500,001 to RM 1,000,000 – RM500.00
And RM 1,000,001 and above – RM1500.00
Johor and Penang have the highest registration fees in the country. Go to the state registration fees website to check.
Question 8: How much is stamp duty and registration?
If you want to know how much is the stamp duty, please refer to question 1 & 2.
For the registration fees, please refer to question 7. Every state has different registration fees. You can try by searching online. Try to search for the State name registration fees. For example, Selangor registration fees.
Question 9: How can I save stamp duty and registration fees?
You can save on the stamp duty by buying a less expensive property, check out the Stamp Duty exemption criteria and purchasing a property from a developer that fall under Home Ownership Campaign (HOC).
Question 10: What is Stamp Duty Exemption?
Stamp duty exemption is when you are exempted from paying stamp duty for buying a house or transfer a property to another person.
Question 11: What are the Criteria to get Stamp Duty Exemption?
There are a few Stamp Duty Exemption for the year 2020. We’re going to list out a few stamp duty exemptions.
a. Stamp Duty Exemption 2020 For Subsale or Under Construction Property
- Must be a first-time house buyer.
- You never own or inherited a house.
- A completed house with a residential land title. Subsale house.
- You are buying a completed house from a Property Agent, Seller, and developer.
- Or you are buying an under-construction house from a developer.
- The house must not fall under small office home office (SOHO), small office flexible office (SOFO), small office virtual office (SOVO) dan service apartment.
- Property Price/ Value must be less than RM500,000
- The maximum exemption is up to the first RM300,000 stamp duty amount.
Stamp duty calculation Malaysia 2019 & Stamp Duty Exemption Malaysia 2020
The First Example,
- If the property Purchase Price or Property value is RM300,000, the property stamp duty will be as follows.
For the first RM100,000, 1% : RM100,000 x 1% = RM1000
From RM100,001 to RM200,000, 2% = RM200,000 x 2% = RM4,000
Total Stamp duty is RM5000.
Total Stamp Duty exemption for a first-time homebuyer is RM5000.
The Second Example,
- If the property Purchase Price or Property value is RM400,000, the property stamp duty will be as follows.
For the first RM100,000, 1% : RM100,000 x 1% = RM1000
From RM100,001 to RM300,000, 2% = RM300,000 x 2% = RM6,000
Total Stamp Duty is RM7,000
Total Stamp Duty exemption for a first-time homebuyer is maximum RM5000.
So, you shall pay the difference RM7000-RM5000= RM2000.
STAMP DUTY EXEMPTION FOR LOAN AGREEMENT
Besides the above exemption, if you are applying for a home loan for the above property, the loan agreement stamp duty will be exempted too.
- The loan agreement Stamp Duty is 0.50% from the loan amount.
- If the loan amount is RM300,000, the stamp duty for the loan agreement is RM300,000 x 0.50% = RM1500
- The exemption applies for a maximum loan amount of RM300,000.
- If the loan amount is RM400,000, the loan agreement stamp duty is RM400,000 x 0.50% = RM2000.
- The maximum stamp duty exemption for loan agreement is RM1500.
- So, you shall pay the difference RM2000-1500 = RM500.
If you are interested to understand more about the Property Stamp Duty Exemption. I have an article writing full detail about the Property Stamp Duty Exemption. Follow the link here.
https://malaysiahousingloan.net/stamp-duty-calculation-malaysia-stamp-duty-malaysia-exemption/
b. Home Ownership Campaign (HOC) Stamp Duty Exemption
Minister of Finance announced the Home Ownership Campaign (HOC) 2019. Under HOC, Malaysian house-buyers will be exempted from stamp duties for purchase of residential units made between January to December 2019.
Furthermore, developers will also offer attractive discounts and packages for house purchases made during the period.
HOC is open to all homebuyers to encourage property ownership and stimulate the Home ownership Campaign.
To understand more about Home Ownership Campaign (HOC). Follow the below REDHA link.
The stamp duty exemption under the HOC campaign is as follows.
a. P.U. (A) 82
All instrument of transfer for the purchase of residential property under the National Home Ownership Campaign 2019, the value of which is more than three hundred thousand ringgit (RM300,000) but not more than two million five hundred thousand ringgit (RM2,500,000), executed by an individual shall be exempted from stamp duty in respect of one million ringgit ( RM1,000,000 ) and below of the value of the residential property.
Read the following link to understand more about the criteria set to get the property stamp duty exemption.
Gazette Link :
http://www.federalgazette.agc.gov.my/outputp/pua_20190319_PUA%2082.pdf
Gazette Link:
(Substituting for the words “30 June 2019” the words “31 December 2019”)
http://www.federalgazette.agc.gov.my/outputp/pua_20190628_PUA%20174.pdf
You’re eligible to apply if the property you bought is under Home Ownership Campaign (HOC) 2019.
Stamp Duty Malaysia Exemption Expiry Date: 31st December 2019
b. P.U. (A) 81
Stamp duty shall be exempted in respect of any loan agreement to finance the purchase of residential property under the National Home Ownership Campaign 2019, the value of which is more than three hundred thousand ringgit (RM300,000) but not more than two million five hundred thousand ringgit (RM2,500,000) , executed between an individual named in the sale and purchase agreement.
Read the following link to understand more about the criteria set to get the property stamp duty exemption.
Gazette Link :
http://www.federalgazette.agc.gov.my/outputp/pua_20190319_PUA%2081.pdf
Gazette Link:
(Substituting for the words “30 June 2019” the words “31 December 2019”)
http://www.federalgazette.agc.gov.my/outputp/pua_20190628_PUA%20173.pdf
You’re eligible to apply if the property you bought is under Home Ownership Campaign (HOC) 2019.
Stamp Duty Malaysia Exemption Expiry Date: 31st December 2019
Question 12: How do I claim the stamp duty exemption?
You can request all the property stamp duty exemption through your lawyer. A law firm will know how to handle the property stamp duty exemption process.
For this case, it also essential to make known to the lawyer that you would like to apply for stamp duty exemption.
Usually, the lawyer will complete a form and send the request to the stamp office. Stamp office will check and verified all the information and make sure you fulfill the criteria.
Finally, once the stamp office satisfied with the documents and information given, they will approve and issue a letter stated the stamp duty is exempted.
In the event, is not. Stamp office will issue a letter requiring you to pay the stamp duty.
Question 13: How much is the stamp duty on an RM300,000 House?
Stamp Duty for a house value RM300,000 is RM5000.
The property Purchase Price is RM300,000.
For the first RM100,000, 1% : RM100,000 x 1% = RM1000
From RM100,001 to RM500,000, 2% = RM200,000 x 2% = RM4,000
Total Stamp Duty Payable is RM5000
Question 14: Does home loan include stamp duty registration?
Under Home Loan or Loan agreement quotation, it shouldn’t be any registration fees.
Registration fees should be in your Sale and Purchase quotation or Memorandum (MOT) quotation.
It has to do with the transfer of a property.
Question 15: Is stamp duty payable on the transfer of property between spouses?
If the property transfer between spouses is by way of love and affection, the property stamp duty is exempted.
Under the Stamp Duty (Exemption) (No. 10) Order 2007, the law provides for stamp duty exemption for a transfer of property between family members by way of love and affection as follows:
a. Between spouses: 100% Exemption Rate
We have a full write up about Transfer of Property Between Family Members in Malaysia. Click the link here.
Question 16: Is stamp duty payable on the transfer of property between Parents and Children?
If the property transfer between parents and children is by way of love and affection, the property stamp duty is 50% exempted.
Under the Stamp Duty (Exemption) (No. 10) Order 2007, the law provides for stamp duty exemption for a transfer of property between family members by way of love and affection as follows:
a. Between Parents and Children: 50% Exemption Rate
Here note that ‘Child’ means a legitimate child, a stepchild or child adopted following any law. Also, stamp duty is typically paid by the transferee (an individual who receive the property), unless agreed otherwise by parties.
Full write up about Transfer of Property Between Family Members in Malaysia. Click the link here.
Okay, that’s is 16 Questions about Stamp Duty Malaysia that most asked by you.
We hope this article brings you clarity about these topics – Stamp Duty Malaysia, Stamp Duty Exemption & Stamp Duty Calculation.
And we will see you in our next article.
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