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clock 24-02-2021
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What Is the Exemption on Stamp Duty on Loan Agreements & Transfer of Property Under Stamp Act 1949?

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This new order is important for the understanding of all practitioners on its effects on real estate transactions which exempts stamp duty on specific loan agreements and on transfer of purchase on residential properties.

STAMP DUTY [EXEMPTION] [NO. 2] ORDER 2021


The minister in the exercise of the powers conferred by subsection 80(1) of the Stamp Act 1949 [Act 378], makes the following order:


Citation and commencement
1. (1) This order may be cited as the Stamp Duty [Exemption] [No. 2] Order 2021.


(2) This Order is deemed to have come into operation on 1 January 2021.


Exemption
2. (1) The Minister exempts from stamp duty any loan agreement to finance the purchase of only one unit of residential property the value of which is not more than RM500,000.00 executed between an individual named in the sale and purchase agreement and any licensed bank: -


(2) The stamp duty exemption under subparagraph (1) shall only apply if –


(a) the sale and purchase agreement for the purchase of the residential property is executed on or after 1 Jan 2021 but not later than 31 Dec 2025; and

(b) the individual has never owned any residential property including a residential property which is obtained by way of inheritance or gift, which is held either individually or jointly.


(3) The application for the exemption of the stamp duty shall be accompanied by a statutory declaration under the Statutory Declaration Act 1960 [Act 783] by the individual referred to in subparagraph (1) confirming that the individual has never owned any residential property Including a residential property which is obtained by way of inheritance or gift, which is held either individually or jointly.


STAMP DUTY [EXEMPTION] ORDER 2021


(1) The Minister exempts all instrument of transfer for the purchase of only one-unit residential property the value of which is not more than RM500,000.00 executed by an individual from stamp duty if –


(a)  the sale and purchase agreement for the purchase of the residential property is executed on or after 1 January 2021 but not later than 31 December 2025; and


(b)  the individual has never owned any residential property including a residential property which is obtained by way of inheritance or gift, which is held either individually or jointly.


(2) For the purpose of subparagraph (1), the value of the residential property shall be based on the market value.


(3) The application for the exemption under subparagraph (1) shall be accompanied by a statutory declaration under the Statutory Declarations Act 1960 [Act 783] by the individual referred to in subparagraph (1) confirming that the individual has never owned any residential property including a residential property which is obtained by way of inheritance or gift, which is held either individually or jointly.


(4) In this paragraph – (for both of the above exemptions)




  1. (a)  “residential property” means a house, a condominium unit, an apartment or a flat


    purchased or obtained solely to be used as a dwelling house; and




  2. (b)  “individual” means a purchaser of a residential property who is a Malaysian citizen or


    a co-purchaser of a residential property who is a Malaysian citizen.




Be advised that as a professional one must be well informed on property related matters. MIEA hopes that this latest update will give you further insight, on how your clients can get an added advantage as savings. Happy Selling!


P.S. ADVOCACY: Is defined as any action that speaks in favour of, recommends, argues for a cause, supports or defends on behalf of others.





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