Under the Real Property Gains Tax (Exemption) Order 2020 under P.U.(A) 218 of the Real Property Gains Tax Act 1976 dated 28th July 2020 (“the Order”), whereby the Order exempts any individual who is a Malaysian citizen from paying gains tax accrued on disposing of a residential property on or after 1st June 2020 till 31 December 2021.

The Order only applies to “Residential Property” and Malaysian Citizen.

Residential Property is defined as house, condominium, apartment or flat and included service apartment, small office home office (SOHO) owned by individual or jointly.

Previously

Previously (before the Order), individual selling their residential property is subjected to Real Property Gains Tax. If you are selling your house within 3 years from acquisition of the property the tax rate is 30% from the gains, 4th year onwards is 20% from the gains, 5th year onwards is 15% from the gains and 6th year onwards is 5% from the gains.

From 1st June 2020 till 31 December 2021

Starting from 1st June 2020 till 31 December 2021 the Order provides that any profit on disposing of a residential property is not chargeable/taxable.

The Order is applicable on the conditions that:-

(a) not more than three units of residential property disposed of shall be eligible for each disposer; and

  • (b) property is not disposed by way of love and affection/Deed of Gift.

 

For the full context please refer to Real Property Gains Tax (Exemption) Order 2020 under P.U.(A) 218 of the Real Property Gains Tax Act 1976 dated 28th July 2020 (“the Order”)