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Stamp Duty Treatment for Transfer of Property by Way of Love and Affection

Updated: Jul 15, 2023


Updated on 15 July 2023- Dialogue between MOF, LHDNM, and CTIM [21/6/2023]

Update: The Ismail Sabri Government Budget is no longer applicable. Malaysia's national budget for 2023 was re-tabled again in February 2023.


To Download Revised Budget 2023 Speech and some other related publications - https://www.ccs-co.com/post/budget-2023-malaysia-madani

Current Position

Effective from 1 January 2019, the stamp duty rate on the instrument of transfer of property is as follows:

Transfer between Husband and Wife

The full imposition of stamp duty is exempted on any instrument of transfer of property executed between a husband and wife.



Transfer between Parents and Children

On the instrument of property transfer completed between parents and children who hold citizenship in Malaysia, the payment of stamp duty is waived in the amount of 50%.

Proposal

To reduce the cost of stamp duty for the transfer of property by way of love and affection between parents and children, grandparents and grandchildren, it is proposed that duty stamp on the instruments of property transfer be fully exempted, limited to the first RM1 million of the property’s value.


The remaining balance of the property’s value is subject to the ad valorem duty rate and is given a 50% remission on the stamp duty imposed.


This stamp duty treatment applies to the recipients who are Malaysian citizens.

Effective Date

For the instrument of transfer of property executed from 1 April 2023.

Updated on 15 July 2023- Dialogue between MOF, LHDNM, and CTIM [21/6/2023]

CTIM welcomes that this is extended to cover grandparents to grandchildren, which looks at three generations of succession planning.


However, recognising the various family situations, there could be very legitimate passing on of property between siblings, and hence it would be inclusive for stamp duty exemption also to cover transfers between siblings so that, among others, property owners without children would not suffer tax for transfer of property by way of love and affection to their natural next choice in their immediate family circle.


Feedback from MOF:

The views of CTIM (Chartered Tax Institute of Malaysia) are noted, but they will need more study.

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