Summary
Malaysia charges Real Property Gains Tax (RPGT) on the gain from selling property in Malaysia, under the Real Property Gains Tax Act 1976, the Inland Revenue Board of Malaysia (LHDN) says. The rate depends on who sells and how long they held the property. For disposals from 1 Jan 2022, citizens and permanent residents pay 30% on a sale within three years, 20% in the fourth year, 15% in the fifth year and nothing from the sixth year. Non-citizens who are not permanent residents pay 30% for the first five years and 10% after that.
The buyer must also hold back part of the price and pay it to LHDN within 60 days of the sale, at 3%, 5% or 7% depending on the seller.
What this means for Malaysia property sellers
RPGT rates for disposals from 2022
| When you sell | Citizens, PRs (Part I) | Malaysian companies, trustees (Part II) | Non-citizens, foreign companies (Part III) |
|---|---|---|---|
| Within 2 years | 30% | 30% | 30% |
| In the 3rd year | 30% | 30% | 30% |
| In the 4th year | 20% | 20% | 30% |
| In the 5th year | 15% | 15% | 30% |
| 6th year and after | 0% | 10% | 10% |
Source: LHDN, RPGT rates (updated 23 Jun 2026).
LHDN applies the Part I table to "any disposer other than" those in Parts II and III, for example an individual Malaysian citizen. Part III covers individuals who are neither citizens nor permanent residents, the estates of such people, and companies not incorporated in Malaysia.
How the gain is worked out
LHDN's RPGT guide defines the gain as the disposal price minus the acquisition price. The disposal price is the sale consideration less allowable expenses, such as work that adds to or keeps the property's value, and less the costs of selling, such as legal fees, stamp duty and commission. The acquisition price is what you paid plus the costs of buying, less any compensation or insurance received for damage to the property.
The retention the buyer pays
The buyer must pay part of the price to LHDN within 60 days of the disposal, LHDN says:
- 3% for citizens, permanent residents and Malaysian companies in most cases;
- 5% for Malaysian companies and trustees selling within three years;
- 7% for non-citizens who are not permanent residents, their estates, and companies not incorporated in Malaysia.
The retention is a prepayment, not the final tax. For disposals from 1 Jan 2025, RPGT runs on self-assessment: the seller works out the tax in the return, and any tax or balance due must be paid within 90 days of the disposal, LHDN says. No separate assessment notice is issued, because the return itself is treated as the assessment.
Common exemptions
LHDN lists these reliefs: a once-in-a-lifetime exemption on the gain from a private residence for a citizen or permanent resident (section 8 of the Act); an exemption for individuals of RM10,000 or 10% of the chargeable gain, whichever is greater; and no-gain, no-loss treatment for gifts between spouses, parents and children, or grandparents and grandchildren, where the donor is a Malaysian citizen. Each has conditions, so check them before you rely on one.
Filing
Sellers file Form CKHT 1A for property and buyers file Form CKHT 2A, both within 60 days of the disposal, through e-CKHT on MyTax. Keep the documents for seven years. LHDN notes that a person who trades in property as a business is taxed under income tax instead of RPGT.
Illustration: the same flat sold in year five and year six
Illustration only. A citizen makes a chargeable gain of RM200,000 on a flat. Sold in the fifth year, RPGT at 15% is RM30,000. Sold in the sixth year, it is nil. A foreign owner with the same gain pays RM60,000 in year five and RM20,000 from year six. Exemptions can reduce these figures.
FAQ
What is the RPGT rate for a Malaysian citizen in 2026? 30% within three years, 20% in year four, 15% in year five and 0% from year six. What do foreigners pay? 30% for the first five years and 10% from the sixth year. How much does the buyer retain from a foreign seller? 7% of the price, paid to LHDN within 60 days.
Education only — not tax, legal or investment advice. Confirm with a licensed professional.
What to do next
- Find your acquisition date and count the years before you set a sale date; the band you fall in sets the rate.
- Keep receipts for buying costs, improvements and selling costs; they reduce the gain.
- Check whether the once-in-a-lifetime residential exemption still applies to you before you use it.
- Ask a verified tax adviser or lawyer to run the numbers: proprkey.com/en/pros?segment=legalFinance
- Compare homes for sale: proprkey.com/en/properties?segment=buyer&mode=buy