Stamp duty is a tax imposed on certain legal documents and transactions in Malaysia, including property purchases and property financing.
When purchasing a property, buyers may encounter several types of stamp duty, including MOT (Memorandum of Transfer) stamp duty and loan agreement stamp duty.
The amount payable depends on factors such as the property value, loan amount, type of transaction and whether any exemption or relief applies.
MOT stamp duty (transfer of ownership)
This is the duty on the instrument that transfers the property into your name. It is charged on a tiered scale, and each rate applies only to the portion of the price that falls inside its band:
1% on the first RM100,000
2% on the next RM400,000 (the portion from RM100,001 to RM500,000)
3% on the next RM500,000 (the portion from RM500,001 to RM1,000,000)
4% on anything above RM1,000,000
Because the scale is tiered rather than flat, crossing a band does not re-price the whole purchase. A RM600,000 property is charged RM1,000 on the first RM100,000, RM8,000 on the next RM400,000, and RM3,000 on the remaining RM100,000 — RM12,000 in total, not 3% of RM600,000.
Loan agreement stamp duty (financing)
This is a flat 0.5% of the loan amount, charged on the loan agreement rather than on the property. On a RM600,000 purchase financed at a 90% margin, the loan is RM540,000, so the duty is RM2,700.
A cash purchase carries no loan agreement, and therefore no loan agreement stamp duty.
What stamp duty is assessed on
Duty is assessed on the higher of the purchase price or the market value as determined by the valuation department. For an arm's-length transaction these are usually the same. For sub-sales, family transfers or below-market deals, the assessed value can exceed the agreed price, and the duty follows the higher figure.
Exemptions and reliefs
Malaysia has, at various times, offered stamp duty exemptions for first-home buyers below certain price thresholds, as well as reliefs for particular transfer types such as transfers between family members. These thresholds and conditions are reviewed with each federal budget and change from year to year.
Because of that, we do not publish exemption thresholds here — a figure that was correct last year may not be correct today. Check the current position with LHDN (the Inland Revenue Board), your conveyancing solicitor or your bank before budgeting on an exemption.
The other costs that arrive at the same time
Stamp duty is rarely the only upfront cost. A typical financed purchase also involves:
Your down payment (the portion of the price not covered by the loan)
SPA legal fees, charged on a tiered scale starting at 1.25% of the first RM500,000
Loan legal fees, charged on the same scale but applied to the loan amount
Valuation fee
Disbursements
SST at 8% on the legal fees
MRTA or MLTA mortgage insurance, if taken
On that same RM600,000 purchase at a 90% margin, these bring the total upfront cash requirement to roughly RM100,000 once the RM60,000 down payment is included — a useful reminder that the deposit is a little over half of what you need on hand.
Our Stamp Duty Calculator works all of this out together, so you see the full upfront cash requirement rather than the duty in isolation.
Please note: these figures are estimates for planning purposes and are not tax or legal advice. Rates and exemptions are set by the government and can change. Confirm your final figures with your solicitor before committing to a purchase.