Malaysia Property Gain Tax for Foreigner – the Latest Updates for 2014!
We have received many enquiries from clients asking us how Malaysia’s Property Gain Tax for foreigner work, and the rates involved. We hope this article will help clarify the doubts!
With effect from 1st Jan 2014 (now delayed to end May 2014), Malaysia government has revised new gain tax rates on property disposal as follows:-
Property purchase sold within first 5 years – 30%
Property sold after 5th year – 5%
Below is the 2013 rates:
Property purchase sold within first 3 years – 15%
Property purchase sold within 3-5 years – 10%
Property sold after 5th year – no tax
Malaysia Property Gain Tax for Foreigner – How does it work?
The Malaysia’s Property Gain Tax for foreigners takes into account all bills for legal fees, stamp duty, maintenance of the property as well as real estate agents’ fees, which you would have paid for when placing a deposit for the property.
Example based on latest 2014 new tax rate:
In February 2011 – you brought a condominium at MYR 580,000
In February 2014 – you sold at MYR 670,000
After 3 years, your gain will be MYR 90,000
You can deduct these expenses paid for the property:
Legal fees and stamp duty during purchase – MYR 12,760
Loan legal fees and stamp duty during purchase – MYR 11,800
Agency fee paid to dispose your property – MYR 11,500
Renovation costs paid – MYR 10,000
Legal fee paid during selling – MYR 1,500
Total expenses paid – MYR 47,560
Net gains on the property : MYR 42, 400
Tax rate to pay will be MYR 42,400 x 30% = MYR 12,720
In actual fact, you only pay approximate 1.8% tax rate on your selling price.
There is no difference in Malaysia’s Property Gain Tax Rate for foreign-owned property title name under individuals or companies.
Malaysia Property Gain Tax for Foreigner – What to do next?
Please be sure to keep a record of all bills paid for submission of the tax efficiency for the disposal process. For those who have not kept or lost the bills, do contact your agent and lawyers who previously handled your property to get copies. The Malaysia’s Property Gain Tax for foreigner, same as Malaysian, does not apply to transferring property between parents and children, husband and wife, grandparents and grandchildren.
Unsure of how to manage selling of your property? Feel free to call us!
As an Independent Investment Consultant, we act on your behalf to spread the wings of marketing and manage the agents’ network for your property on your behalf. We complete our task by managing your tax bill to maximise the best rate in Malaysia’s Property Gain Tax for foreigners, after your property is sold. The legal process will take about 4-5 months to complete.
[Read: Taxation on Rental Receivable]
Free yourself and more so, stay in peace. Let us work while you are in your country. We assist all Malaysia My Second Home clients and all foreigners of other forms of visa in all aspects of Malaysia’s real estate investment. International investors benefit, in terms of saving time and money, by outsourcing the entire process of purchasing or selling their Malaysia’s property. We “simplifying your property investment in Malaysia”