Real Property Gain Tax (RPGT) & Exemption

Under Budget 2012, a new structure of RPGT was introduced:-

- Properties held and disposed within 2 years, RPGT = 10%
- Properties held and disposed after 2 years & up to 5 years , RPGT = 5%

(Note: The RPGT of 5% flat for disposal of real properties or shares un real property companies within 5 years is no longer applicable.)

However, RPGT is exempted or no RPGT is levied even though they are disposed within the first 5 years from the date of purchase:-

- Disposal of a residential property once in a lifetime by an individual who is a Malaysian citizen or a permanent resident if he/she elects in writing for the exemption to apply to that private residence.

- Transfer as gifts between parent and child, husband and wife, grandparent and grandchild which are deemed to be "No Gain No Loss" (transfer between sibling/brothers or sisters is not applicable); and

- Exemption of RM10,000 or 10% of the chargeable gain, whichever is greater, for each disposal of a property by an individual. Chargeable gain is generally meaning sale proceeds less purchase cost.

- Transfers between companies that bring greater efficiency or for purpose of reorganization/restructuring.

- Transactions in which the disposal price is deemed equal to acquisition price (i.e. “No Gain No Loss" transactions)