Stamp Duty in Malaysia 2026: How Much Is It and Who May Be Exempt?

📌 Quick Answer: As of 14 July 2026, stamp duty on the property transfer instrument in Malaysia is generally calculated on the purchase price or market value (whichever is higher), at tiered rates. Under Budget 2026, a 100% stamp duty exemption on both the instrument of transfer and the loan agreement is proposed/extended for Malaysian citizens buying their first residential home priced up to RM500,000, for SPAs executed up to 31 December 2027. For properties above RM500,000, or for buyers who don’t meet the first-time-buyer conditions, standard tiered rates generally apply. This guide focuses on residential property purchases by individual Malaysian buyers, particularly first-time buyers — foreign buyers, companies, transfers by love and affection, inheritance, refinancing, and other non-standard transactions may be treated differently and are not covered here. Always verify your specific position at hasil.gov.my or with a conveyancing lawyer before transacting. 

Stamp duty is one of the costs that can catch buyers off guard. 

It often surfaces late in the planning process — after the property has been identified, after the loan application is underway, and sometimes only when the lawyer prepares the full transaction cost estimate. By that point, many buyers have already mentally committed to the purchase. This can create cash-flow pressure for buyers who have budgeted tightly, especially if they haven’t set aside a separate buffer for transaction costs. 

PropertyGuru Malaysia’s H1 2026 Consumer Sentiment Study found that 73% of Malaysians want more affordable housing measures from the government. The stamp duty exemption for first-time buyers is one existing measure, though it’s worth noting it applies only up to a RM500,000 threshold and only to first-time buyers who meet the eligibility conditions. 

Understanding roughly how stamp duty is calculated — and where the first-time buyer exemption does and doesn’t apply — can help buyers avoid surprises before the lawyer’s estimate arrives, though the exact figures should still be confirmed with a lawyer or LHDN for your specific transaction. 

What Is Stamp Duty 

Stamp duty is a government tax on documents relating to property transactions. In a typical Malaysian residential property purchase, it generally applies to two main documents: the instrument of transfer (commonly the Memorandum of Transfer, or MOT), which records the change of ownership, and the loan or financing agreement between the buyer and the bank. 

These two documents are assessed separately. The transfer instrument is generally calculated on the purchase price or the property’s market value, whichever is higher — not simply the agreed purchase price. The loan agreement is generally calculated on the loan amount. 

The Tiered Rate on the Transfer Instrument (Worked Example) 

For buyers who don’t qualify for an exemption, stamp duty on the transfer instrument is typically calculated using a tiered structure, where each price band is taxed at its own rate rather than the whole price being taxed at the top rate. 

The commonly cited tiered structure is roughly as follows, though rates, bands, and applicability can change and should always be verified with LHDN or a lawyer before transacting: 

Portion of price/market value	Indicative rate
First RM100,000	1%
RM100,001 – RM500,000	2%
RM500,001 – RM1,000,000	3%
Above RM1,000,000	4%

Worked example: For a RM600,000 property where no exemption applies, the transfer instrument duty would generally be calculated as: 1% on the first RM100,000 (RM1,000) + 2% on the next RM400,000 (RM8,000) + 3% on the remaining RM100,000 (RM3,000) — an indicative total of around RM12,000. This is illustrative only; the actual amount depends on the assessed value used by LHDN, which may differ from the agreed purchase price, and on any applicable exemptions. 

This cost is separate from the loan and is generally expected to be paid from the buyer’s own funds unless an exemption, developer package, bank package, or other approved arrangement clearly applies. 

The First-Time Buyer Exemption 

Under Budget 2026 measures, first-time Malaysian citizen buyers purchasing a residential property priced up to RM500,000 may qualify for a full exemption from stamp duty on the transfer instrument. This exemption is generally intended for Malaysian citizens purchasing their first residential property, subject to the specific conditions set out in the exemption order. 

The same exemption is generally understood to extend to the loan or financing agreement stamp duty, so eligible first-time buyers in this segment may see both components waived. 

According to MOF’s Budget 2026 announcement, this exemption has been extended to cover SPAs executed up to 31 December 2027. Because exemption terms, thresholds, and end dates are subject to change, it’s worth confirming the current position at hasil.gov.my or with your lawyer before proceeding, rather than relying on this figure alone. 

One important nuance: LHDN’s stamp duty materials indicate that the RM500,000 threshold is generally assessed against the property’s value or market value, not solely the agreed purchase price. This means a property priced at or slightly under RM500,000 in the SPA could still fall outside the exemption if its assessed market value is higher — so buyers close to the threshold shouldn’t assume eligibility based on purchase price alone. 

This exemption is most relevant for buyers in the sub-RM500,000 segment. PropertyGuru Malaysia’s H1 2026 Consumer Sentiment Study found that approximately 65% of Malaysians intending to buy a property have budgets below RM500,000. For eligible first-time buyers in this group, the exemption — where it applies — can remove a meaningful upfront cost from the transaction. 

The Loan Agreement Stamp Duty 

The loan or financing agreement between buyer and bank is a separate stampable document. For buyers who don’t qualify for an exemption, stamp duty on the loan agreement is generally calculated on the loan amount, commonly at a rate of around 0.5%, though this is subject to LHDN’s current rules and assessment and should be confirmed for your specific transaction. 

For example, in a purchase just above the exemption threshold — say a RM500,001 purchase price with a RM450,001 loan — both documents would generally attract stamp duty: the transfer instrument duty on the purchase price (or market value, if higher), and the loan agreement duty on the loan amount. Together, these can represent a meaningful additional cost, generally expected to come from the buyer’s own funds unless a specific exemption or package applies. 

For buyers close to the RM500,000 threshold, whether the final assessed price or value falls above or below that line can have a direct financial consequence — though as noted above, this depends on assessed value, not just the agreed purchase price, so buyers near the line should get this confirmed rather than assuming either outcome. 

When the Exemption Generally Does Not Apply 

Based on the conditions typically attached to this exemption: 

• It generally does not apply if the buyer has previously purchased a residential property in Malaysia — it’s intended as a first-timer benefit. 

• It generally does not apply where the purchase price or assessed market value exceeds RM500,000, regardless of first-timer status. 

• Foreign buyers are generally not eligible for this exemption and may be subject to different stamp duty rates altogether. 

These are general patterns rather than an exhaustive list — buyers should confirm their specific eligibility against the current exemption order. 

How the Exemption Is Typically Applied 

The exemption is usually handled by your lawyer as part of the stamp duty filing process rather than something the buyer files for separately. However, it isn’t simply automatic: the buyer generally still needs to meet the eligibility conditions and provide the required declaration and supporting documents confirming first-time buyer status, so that the lawyer can apply the exemption correctly when the instrument is stamped. 

It’s worth confirming with your lawyer, before documents are submitted for stamping, that your first-time buyer status has been properly declared and that the purchase price and assessed value fall within the eligible threshold. 

The Bottom Line 

Stamp duty in Malaysia generally applies to the transfer instrument and the loan or financing agreement on a property purchase. Under Budget 2026 measures, first-time Malaysian citizen buyers purchasing up to RM500,000 may be fully exempt from both, for SPAs executed up to 31 December 2027 — subject to eligibility conditions and confirmation at the time of stamping. For buyers above the threshold, or those who don’t meet the first-time-buyer conditions, tiered rates generally apply to both documents. 

This guide covers the general position for individual Malaysian buyers of residential property, particularly first-time buyers. It does not cover foreign buyers, company purchases, transfers by love and affection, inheritance, refinancing, or other non-standard transactions, which may follow different stamp duty rules entirely. 

Understanding your likely stamp duty position — and confirming it with a lawyer — before committing to a purchase price is a useful part of estimating the true upfront cost of a transaction. Verify current rates, thresholds, and exemption conditions at hasil.gov.my or with a qualified conveyancing lawyer. 

Quick Recap 

• Stamp duty generally applies to the transfer instrument (calculated on purchase price or market value, whichever is higher) and the loan agreement (calculated on the loan amount, commonly around 0.5%). 

• Indicative tiered rates on the transfer instrument: 1% (first RM100,000), 2% (RM100,001–500,000), 3% (RM500,001–1,000,000), 4% (above RM1,000,000) — always confirm current rates with LHDN. 

• Under Budget 2026, first-time Malaysian citizen buyers purchasing residential property up to RM500,000 may be fully exempt from both stamp duties, for SPAs executed up to 31 December 2027. 

• The RM500,000 threshold is generally assessed against property value/market value, not just the agreed purchase price. 

• The exemption is usually applied by your lawyer during stamping, but eligibility still needs to be met and declared/supported with documentation — it isn’t automatic. 

• Approximately 65% of Malaysian buyers have budgets below RM500,000, per PropertyGuru Malaysia’s H1 2026 Consumer Sentiment Study. 

• Buyers should plan to pay stamp duty and related transaction costs from cash, unless an exemption, developer package, bank package, or approved financing arrangement clearly applies. 

• This guide focuses on individual Malaysian first-time buyers of residential property; foreign buyers, companies, and non-standard transactions (love and affection, inheritance, refinancing) may follow different rules. 

• Verify current rates and conditions at hasil.gov.my before transacting.