Disposal of properties held for 6 years or more will no longer have to pay property profit tax!
Finance Minister Tunku Zavru announced in the 2022 budget that the government will abolish the Real Property Gains Tax (RGPT) for the sale of properties held for 6 years or more than 6 years. This measure will take effect from 2022.
This means that people do not need to pay property profits tax when they sell properties that they hold for 6 years or above. While promoting the development of domestic industries, it can also effectively combat real estate speculation. However, property profit tax will still be paid when disposing of properties held for less than 5 years.
Malaysian citizens and permanent residents are required to pay 30% Real Property Gains Tax when they sell properties that they hold for less than 3 years, while Real Property Gains Tax of 20% and 15% when they sell properties in the 4th and 5th years respectively. When a foreigner sells a property held for less than 5 years, he will be levied a 30% Real Property Gains Tax.
At present, Malaysian citizens or permanent residents are still required to pay a 5% Real Property Gains Tax when they sell properties that they hold for more than 5 years, while foreigners are required to pay a 10% Real Property Gains Tax. As a result, children who inherit their parents’ estates and people who transfer properties to their children are forced to pay a 5% Real Property Gains Tax.
Real Property Gains Tax 2022
Malaysian citizens and permanent residents
Holding for less than 3 years: 30%
Holding for 4 years: 20%
Holding for 5 years: 15%
Holding for 6 years or more: 0%
Foreigner
Holding for 5 years or less: 30%
Holding for 6 years or more: 10%
