Exemption (RPGT Act 1976)

• 1st disposal of residential property (only applicable to Malaysian citizens and permanent residents)
• Disposal of property between family members.
• Exemption waiver for an amount equal to 10% of taxable profits, or RM10,000 (whichever is higher)

RPGT Formula Gross Chargeable Gain = Disposal Price – Acquisition Price Net Chargeable Gain = Gross Chargeable Gain – RPGT Exemption - Miscellaneous Expenses (eg. legal fees, sales commission etc) RPGT Payable = Net Chargeable Gain X RPGT Rate (based on holding period) Example Acquisition Price: RM300,000 Disposal Price: RM500,000 Disposal: 5th year Gross Chargeable Gain: RM500,000 - RM300,000 = RM200,000 Net Chargeable Gain: RM200,000 - RM20,000 (RPGT Exemption) - RM15,000 (Miscellaneous Expenses) = RM165,000 RPGT Payable: RM165,000 X 15% = RM24,750 RPGT Rates Pursuant to the Finance Act 2021 gazetted on 31 December 2021, RPGT will no longer be imposed on property disposals by individual owners starting from the 6th year, with effect from 1 January 2022. Retention Sum by Acquirer in relation to Disposal of a Chargeable Asset CONCLUSION With the abolishment of RPGT for the sale of properties held from 6th year onwards, we believe property owners will be motivated to upgrade to their desired house without any tax penalty. It is a long-awaited measure, as many see it as an unjust way to penalise longterm property owners on inflation and therefore this abolishment is very much welcomed by all. For any queries or further information, please do reach out our Projects Practice Group: Mr. Zuhaidi Shahari, Partner cum Team Leader [email protected] Mr. Mohd Sallahudin Abdullah, Partner [email protected] Ms. Lim Sheh Ting, Partner [email protected]