Malaysia Property Gain Tax Rate for foreigners – the Latest Updates!
We have received many inquiries from clients asking us how Malaysia’s Property Gain Taxes for foreigners work, and the taxes involved. We hope this article will help clarify the doubts!Malaysia Property Gain Tax for Foreigners
With effect from 1st Jan 2014, Malaysia government has revised a new tax rate on property disposal gain as follows for foreigners as follows:
Property purchase sold within the first 5 years – 30%
Property sold after 6th year – 5%
The 2014-Malaysia Property Gain Tax Rate for foreigners is the same for local Malaysians as follows:
Property purchase sold within first 3 years – 30%
Property purchase sold on 4th year – 20%
Property purchase sold on 5th year – 15%
Property sold after 6th year – 0%
Malaysia Property Gain Tax Rate for foreigners – How does it work?
The Malaysia Property Gain Tax for foreigner takes into account all bills for legal fees, stamp duty, maintenance of the property as well as real estate agents’ fees, for your property.
Example of Malaysia Property Gain Tax for foreigners and Malaysians:
In March 2009 – you brought a condominium at RM 580,000
In January 2013 – you sold at RM 670,000
After 3 years, your gain will be RM 90,000
You can deduct these expenses paid for the property:
Legal fees and stamp duty during purchase – RM 12,760
Loan legal fees and stamp duty during purchase – RM 11,800
Agency fee paid to dispose of your property – RM 11,500
Renovation costs paid – RM 10,000
The legal fee paid during selling – RM 1,500
Total expenses paid – RM 47,560
Net gains on the property: RM 42,400
Tax rate to pay will be RM 42,400 x 10% = RM 4,240
In actual fact, you only pay an approximate 5% tax rate, not 10%.
There is no difference in Malaysia Property Gain Tax Rate for a foreign-owned property title name under individuals or companies.
Malaysia property gain tax rate for foreigners – 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 Property Gain Tax does not apply to transfer property between parents and children, husband and wife, grandparents and grandchildren.
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 maximize the best rate in Malaysia 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 foreigners through ExpatriateAdvisory.com in all aspects of Malaysia real estate investment. International investors will benefit on time and money-saving, by outsourcing the entire process of purchasing Malaysia property and selling Malaysia property. ExpatriateAdvisory.com portal is strictly for foreigners!
Interested to join Malaysia My Second Home program? Send us your inquiry form today!