What is the stamp duty rate on property in Malaysia?

Stamp duty on the Memorandum of Transfer (MOT) is tiered: 1% on the first RM100,000; 2% on RM100,001–RM500,000; 3% on RM500,001–RM1,000,000; and 4% on any amount above RM1,000,000. Stamp duty on the loan or financing agreement is a flat 0.5% of the loan amount.

Do first-time buyers get a stamp duty exemption in Malaysia?

Yes. Malaysian citizens purchasing their first residential property priced at RM500,000 and below are entitled to a full exemption from MOT stamp duty under P.U.(A) 448/2025. A separate exemption for the loan or financing agreement is available under P.U.(A) 449/2025. Both exemptions must be applied at the stamping stage by your solicitor.

Can MOT stamp duty be included in the home loan in Malaysia?

Stamp duty is generally a cash outlay forming part of the buyer's upfront costs. Some bank packages provide for financing of stamp duty costs; this varies between lenders and should be discussed when comparing loan offers.

When does stamp duty have to be paid in Malaysia?

The Stamp Act 1949 requires instruments to be presented for stamping within 30 days of execution in Malaysia. In practice, your solicitor collects the stamp duty as part of the completion account and presents the instruments to LHDN before registration at the Land Office. Late presentation attracts a penalty.

STAMP DUTY ON PROPERTY IN MALAYSIA: RATES, EXEMPTIONS AND WHO PAYS WHAT

Q: What if LHDN adjudicates my property at a higher value than my purchase price?

Stamp duty is assessed on whichever is higher: the stated consideration or the market value as assessed by the Jabatan Penilaian dan Perkhidmatan Harta (JPPH), per Item 32 of the First Schedule to the Stamp Act 1949. You may appeal by submitting a valuation report to substantiate that your purchase price reflects market value. If the appeal does not succeed, the remaining recourse is to challenge the assessment in court.

TAN KHAI SEONG

2026

Stamp duty is one of the most frequently misunderstood costs in a property purchase. Every buyer knows it exists, but when clients ask me how much they will actually pay, the answer is rarely straightforward. The stamp duty calculation depends on the purchase price, the loan amount, and whether the buyer qualifies for an exemption, with the answer differing between a first-time buyer and a repeat purchaser.

This article sets out the current framework plainly. I cover the two separate stamp duty instruments that arise in a standard purchase, the applicable rates, the exemptions available to first-time buyers, and two worked examples so you can estimate the duty payable before the figures appear in your lawyer’s invoice.

The Legal Basis: Stamp Act 1949

Stamp duty in Malaysia is governed by the Stamp Act 1949. The rates for instruments relating to property transactions are set out in the First Schedule to the Act, read together with any annual Finance Act that amends it. If you are reading an old copy of the Stamp Act, please check whether the rates have been revised.

The Inland Revenue Board (LHDN) administers assessment, collection of duty and adjudication of instruments.

One point that surprises many buyers: stamp duty is assessed on the higher of the transaction price or the market value as adjudicated by LHDN, per Item 32 of the First Schedule. If you purchase a property below market value (common in transactions between family members or friends, or in distressed sales), LHDN will assess duty on the adjudicated market value, not the price stated in your SPA.

Two Separate Instruments, Two Separate Duties

In a standard property purchase with a bank loan, two separate instruments attract stamp duty:

Instrument	What It Is	Who Pays
Memorandum of Transfer (MOT)	The instrument transferring ownership from seller to buyer	Buyer
Loan / Financing Agreement	The facility agreement between borrower and bank	Borrower (buyer)

These are calculated independently. The total stamp duty payable is the sum of both. The Third Schedule of the Stamp Act 1949 sets out who is liable to pay the duty on each instrument.

Stamp Duty Rates on the Memorandum of Transfer

The MOT stamp duty is an ad valorem duty that scales with the value of the property. The rates under Item 32 of the First Schedule are:

Property Value	Rate
First RM100,000	1%
Any amount in excess of RM100,000 but not exceeding RM500,000	2%
Any amount in excess of RM500,000 but not exceeding RM1,000,000	3%
Any amount in excess of RM1,000,000	4%

These rates apply to each band in turn, tiered rather than as a flat rate on the whole amount, similar in structure to how income tax bands operate. The full First Schedule is available at the Attorney General’s Chambers website (Item 32, page 86 of the Act).

Stamp Duty on the Loan or Financing Agreement

The stamp duty on a loan agreement or financing facility, whether conventional or Islamic, is a flat rate of 0.5% of the total loan or facility amount, per Item 27(a)(iii) of the First Schedule. The relevant provision is at page 84 of the Act, available at the Attorney General’s Chambers website.

Islamic home financing instruments (Murabahah, BBA, Musharakah Mutanaqisah) attract the same 0.5% rate as conventional financing.

Worked Example 1: Subsale Property, No Exemption

Facts: Buyer purchases a subsale condominium in Kuala Lumpur for RM750,000. Bank loan of RM600,000 (80% margin).

MOT stamp duty:

Band	Amount in Band	Rate	Duty
First RM100,000	RM100,000	1%	RM1,000
RM100,001 – RM500,000	RM400,000	2%	RM8,000
RM500,001 – RM750,000	RM250,000	3%	RM7,500
Total MOT stamp duty			RM16,500

Loan agreement stamp duty: RM600,000 × 0.5% = RM3,000

Total stamp duty payable: RM19,500

Worked Example 2: First-Time Buyer, RM400,000 Property

Facts: Malaysian citizen, first property purchase for RM400,000. Bank loan of RM360,000.

MOT stamp duty (before exemption):

Band	Amount in Band	Rate	Duty
First RM100,000	RM100,000	1%	RM1,000
RM100,001 – RM400,000	RM300,000	2%	RM6,000
Total			RM7,000

Under the first-time buyer exemption, the full RM7,000 MOT duty is waived.

Loan agreement stamp duty: RM360,000 × 0.5% = RM1,800

Total stamp duty payable: RM0, a saving of RM8,800 on the MOT and loan agreement stamp duty.

A note on calculators: Several online stamp duty calculators provide a reasonable estimate for budgeting purposes. A quick search for “Malaysia stamp duty calculator” will surface a few options. Bear in mind these tools update at different rates; your solicitor’s figure at completion is the authoritative one.

Practical tip: If you need a short extension to arrange payment of stamp duty, it is worth discussing the timeline with your solicitor early. An extension of a month or two is not unusual. That said, if funding stamp duty requires stretching your finances significantly, it is worth pausing to assess whether the timing of the purchase is right.

Stamp Duty Exemptions

First-Time Buyer Exemption

The first-time buyer exemption is the one most likely to have changed by the time you read this, as it is revised or extended with most annual Budgets, and the specific conditions shift accordingly.

For the current position, the most reliable starting point is the LHDN e-Stamping portal at stamps.hasil.gov.my. Navigate to Akuan Berkanun (Statutory Declaration) for the first-time buyer exemption; the declarations list the specific Exemption Order numbers and eligibility criteria in force. This is also what your solicitor will use to verify your eligibility at the stamping stage.

The current order in force is P.U.(A) 448/2025, which extends the earlier P.U.(A) 53/2021.

The standard conditions across most iterations of this exemption are:

Malaysian citizen only
First residential property: you must not have previously owned a residential property in Malaysia, whether by purchase or inheritance
Property price must not exceed RM500,000: the exemption applies to the full purchase price where it falls within this threshold, not merely to the first RM500,000 of a higher-priced property
Applies to both sub-sale and developer (new) purchases
The purchase must fall within the period specified in the applicable Exemption Order

The MOT stamp duty exemption is covered under the orders above. A separate but parallel exemption applies to the loan or financing agreement under P.U.(A) 449/2025, which extends the earlier P.U.(A) 54/2021. Your solicitor will apply both exemptions at the stamping stage where eligible.

Your solicitor will apply the exemption on your behalf when presenting the instruments for stamping; it is LHDN that ultimately confirms whether you qualify.

When Is Stamp Duty Paid?

The Stamp Act 1949 requires instruments to be presented for stamping within 30 days of execution in Malaysia. In practice, the timing is managed by your solicitor:

Upon signing of the SPA: the SPA itself may attract a nominal duty; your solicitor will advise.
At completion / presentation for registration: the MOT and charge are submitted to LHDN for adjudication and stamping before registration at the relevant Land Office.
Disbursement of stamp fees: your solicitor will collect the stamp duty amounts as part of the completion account together with legal fees.

Late presentation attracts a penalty under the Stamp Act. There is no practical reason to miss the deadline; your solicitor’s billing schedule ensures stamp duty is collected before the due date.

Frequently Asked Questions

I am buying a property jointly with my spouse. Do we both qualify for the first-time buyer exemption?

Each purchaser’s eligibility is assessed individually. If both you and your spouse are first-time buyers, a joint purchase of a property priced at or below RM500,000 qualifies for the full MOT exemption. If one co-purchaser has previously owned residential property, the exemption applies only to the eligible co-purchaser’s share. For example, on a RM300,000 property with a total MOT duty of RM5,000, the eligible co-purchaser’s half (RM2,500) is waived and the ineligible co-purchaser pays RM2,500, making the total duty payable RM2,500.

Is stamp duty the same for Islamic and conventional home financing?

Yes. Stamp duty on a financing facility is 0.5% of the facility amount regardless of whether the structure is conventional or Shariah-compliant.

What if LHDN adjudicates my property at a higher value than my purchase price?

You may appeal by submitting a valuation report to substantiate that your purchase price accurately reflects market value, rather than the figure assessed by the Jabatan Penilaian dan Perkhidmatan Harta (JPPH). If the appeal does not succeed, the remaining recourse is to challenge the assessment in court.

Can MOT stamp duty be included in the home loan?

Stamp duty is generally a cash outlay forming part of the buyer’s upfront costs, alongside legal fees and the differential sum. That said, some banks may offer packages that cover stamp duty financing and it is worth asking your banker when comparing loan offers, as availability and terms vary between lenders.

Summary

Cost Item	Basis	Rate
MOT stamp duty	Property value (tiered)	1% – 4%
Loan agreement stamp duty	Loan amount (flat)	0.5%
First-time buyer exemption — MOT (if eligible)	Property ≤ RM500,000	Full waiver
First-time buyer exemption — Loan agreement (if eligible)	Property ≤ RM500,000	Full waiver

Stamp duty is a material cost that buyers should factor in before making an offer, well before the SPA is signed. For a RM700,000 property with a RM560,000 loan, the combined stamp duty alone approaches RM18,000, before legal fees and registration costs are added. Knowing the number early avoids surprises at the completion stage.

If you are buying property in Kuala Lumpur and would like advice on the total cost structure of your transaction, or have a specific question about exemption eligibility, you are welcome to get in touch.

This article reflects the general legal position as at June 2026. Stamp duty rates and exemption thresholds are subject to amendment by annual Budget announcements and Ministerial Orders. Nothing in this article constitutes legal advice in respect of any specific transaction. Please consult a qualified solicitor for advice on your particular circumstances.