Transfer of House Title Between Family Members In Malaysia
In a Malaysian property transaction, if transferring the name of the property to a new owner, stamp duty is required to be paid. stamp duty is a tax imposed on documents in the sale or transfer of a property.
According to the current tax rate:
- the first RM100,000 of the property price is subject to 1% stamp duty
- the next RM400,000 is subject to 2%
- and the next amount is subject to 3% stamp duty
- and after RM1,000,000 The stamp duty is 4%
The table is as follow :
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| PRICE TIER | STAMP DUTY (% OF PROPERTY PRICE) |
|---|---|
| First RM100,000 | 1% |
| Next RM400,000 (RM101,000 – RM500,000) | 2% |
| RM500,001 – RM 1 million | 3% |
| More than RM 1 million | 4% |
Not sure how to calculate? Here's an example. Let's say you purchase a property that costs RM750,000, you will have to pay a total of:
{(First RM100,000 X 1%) + (Next RM400,000 X 2%) + (Remaining RM250,000 X 3%) } + 0.5% of loan amount (90% of RM750,000)
= {RM1,000 + RM8,000 + RM7,500} + 0.5% X (RM675,000)
= RM16,500 + RM3,375
= RM19,875
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However, under certain circumstances, especially the transfer of names between family members, you can enjoy a free of-charge stamp duty. This is known as a ‘love and affection’ transfer without the consideration of monetary gains.
The scenario is applicable to transfers of names between husband and wife, parents and child.
Exemption of 50% is given for the stamp duty in-case of transfers of names between spouses, and transfer of name between parent and child.
If transferer and transferree are siblings/relatives/partners (non- legally married), then a full stamp duty rate will be charged.
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