Loan agreement stamp duty is the stamp duty payable on a financing or loan agreement used to finance a property purchase.
For a conventional Malaysian property loan, it is generally calculated based on the amount financed rather than the property's full purchase price.
The applicable rate and treatment may depend on the type of financing and current regulations.
The standard rate
For a conventional property loan, the duty is generally 0.5% of the loan amount.
The distinction between loan amount and purchase price matters. On a RM500,000 property financed at a 90% margin, the duty is charged on the RM450,000 borrowed, not on the RM500,000 price — so RM2,250 rather than RM2,500. On the same property at a 70% margin, the loan is RM350,000 and the duty falls to RM1,750.
A few worked figures
RM450,000 loan: RM2,250
RM540,000 loan: RM2,700
RM800,000 loan: RM4,000
Cash purchases
If you are buying without financing, there is no loan agreement, and therefore no loan agreement stamp duty. A cash buyer still pays MOT stamp duty on the transfer.
A separate duty from MOT stamp duty
These are two different taxes on two different documents, and both are usually payable on a financed purchase. The MOT duty is charged on the transfer of ownership; the loan agreement duty is charged on the financing arrangement. Budget for both.
Different financing types may be treated differently
Islamic financing facilities, refinancing, and certain government or employer schemes can carry different treatment or reliefs. Exemptions on loan agreement stamp duty have also been offered from time to time as part of first-home buyer initiatives. Your bank and your solicitor will confirm what applies to your specific facility.
Please note: this article describes the general position for conventional property loans and is not tax or legal advice. Confirm your figures with your bank or solicitor.