Property and Land Taxes in Malaysia

Property and Land Taxes in Malaysia
If you are wondering what the property and land taxes are related to a house here in Malaysia, they are low compared to the US and many other places.
There are two types of property ownership in Malaysia Leasehold and Freehold. Leasehold is when you lease the land for a period of time often 99 years and then it is renewable [or not] at the end of the lease. The other is Freehold where you own the property outright. We prefer Freehold and were lucky to find a freehold property we like and could afford. For more info on freehold/leasehold check here. By the way, most properties available in KL are leasehold. Foreigners can own either Freehold or Leasehold.
There are two main costs associated with property and land ownership in Malaysia. One is called the Assessment Tax which is a tax generated twice a year by the local Majlis Perbandaran where the property is located. Assessment tax is collected by the local authorities for the ‘provision of services to the residents’. The amount and classification of properties varies from state to state and within the state. In most states the amount of the assessment tax a house owner pays is calculated on the annual value of the of the property and the annual value of the property is the total value of rents if the house is rented out in the open market. If this sounds confusing, I agree. If you want more info. you better do some googling.
The other payment is for the Quit Rent (rent is a deceiving word here) which is generated in our case by the Kerajaan Negeri Sembilan Darul Khusus. This is a once a year payment. From what I understand, Quit Rent is a form of land tax collected by the Malaysian State Governments. It is imposed on owners of all land. The amount of the quit rent varies from state to state and even within each state. For more info. check here.
1). Assessment Tax on Residential Property
The assessment tax is a local tax based on the annual rental value of the property, as assessed by the local authorities. It is generally levied at a flat rate of 6% for residential properties and payable in two installments.
2). Quit Rent
The quit rent is a local tax levied on all landed properties, payable annually at a rate of 1 sen to 2 sen per square foot, wherein RM1 is equal to 100 sen (cents). The quit rent liability is generally estimated to be less than RM100 per year.
http://www.pdtjasin.gov.my/en/online-services/e-calculator/computation-of-yearly-land-tax-rate.html
For Examole, the bungalow( has a Quit Rent cost of 218 RM per year and a Assessment cost of 780 RM total per year. therefore, you may have rough idea about your property.
Real Property Gains Tax
Disposals of Malaysian real property held for less than two years are subject to real property gains tax (RPGT) at a flat rate of 10%. Disposals of Malaysian real property held for less than five years but more than two years are subject to real property gains tax (RPGT) at a flat rate of 5%. No real property gains tax (RPGT) is levied on disposals of properties held for more than five years.
REAL PROPERTY GAINS 2012
OWNERSHIP PERIOD
TAX RATE
Up to 2 years 10%
2 years – 5 years 5%
Over 5% 0%
Source: Global Property Guide
Stamp Duty
When purchasing a property, stamp duty must be paid on the Memorandum of Transfer. Stamp duty is based on the purchase price:
•For the first RM 100,000, stamp duty is one percent
•For the next RM 400,000, stamp duty is two percent
•Anything over RM 500,000, stamp duty is three percent
There are penalties for the late payment of stamp duty.