Stamp Duty When Buying a Home in Malaysia: What It Is & How It Is Calculated

When you buy a home in Malaysia, you pay stamp duty on two documents: the instrument of transfer (the Memorandum of Transfer, Form 14A) and, if you take a housing loan, the loan agreement. Stamp duty on the transfer is charged on a tiered scale of 1% to 4% of the property's value, and stamp duty on the loan agreement is 0.5% of the loan amount. This guide explains what stamp duty is, the current rates, and how to calculate it with worked examples.

What is stamp duty?

Stamp duty is a tax imposed under section 4 of the Stamp Act 1949 on the instruments (documents) listed in the First Schedule to the Act. It is paid to the Inland Revenue Board of Malaysia (LHDN, also called IRBM), which assesses and collects it.

For a home purchase, the documents that matter are:

• The instrument of transfer (Form 14A / Memorandum of Transfer, often called the MOT), which transfers the title from the seller to you. This attracts ad valorem duty, meaning duty calculated on the value of the property.

• The loan or financing agreement, if you are financing the purchase. This attracts ad valorem duty calculated on the loan amount.

• The Sale and Purchase Agreement (SPA) itself is generally stamped at a small fixed duty. The main duty falls on the transfer, not the SPA.

In practice, the buyer pays the stamp duty on the transfer and on the loan agreement.

Stamp duty on the instrument of transfer

The rates under Item 32(a) of the First Schedule, for Malaysian citizens and permanent residents, are:

Two points are easy to miss:

• The rates are tiered, not flat. Each rate applies only to the part of the value that falls within that band.

• The value used is the purchase price or the market value, whichever is higher. If LHDN assesses the market value above your price, duty is charged on the market value.

Worked examples

Foreign buyers

Different rates apply to transfers to foreign individuals (who are not citizens or permanent residents) and foreign companies. From 1 January 2026, the transfer of residential property to a foreign buyer is charged at a flat 8% (RM8 for every RM100). Other property transferred to a foreign buyer is charged at a flat 4%. For the wider rules, see our guide on buying property in Malaysia as a foreigner.

Stamp duty on the loan agreement

If you finance the purchase with a housing loan, the loan agreement is stamped at 0.5% of the loan amount (RM5 for every RM1,000). This is a flat rate, not tiered.

Putting it together: if you buy a RM500,000 home with a RM450,000 loan and no exemption applies, you would budget about RM9,000 for the transfer and RM2,250 for the loan agreement, a total of RM11,250 in stamp duty. That is separate from legal fees, searches and registration fees.

First-home exemption

Malaysian citizens buying their first residential home may qualify for a full stamp duty exemption. Under Budget 2026, the 100% exemption on the instrument of transfer and the loan agreement for a first home priced up to RM500,000 applies to SPAs executed from 1 January 2026 to 31 December 2027, subject to the conditions in the exemption order. Eligibility, the documents you must provide and the other exemptions available are covered in our separate guide on stamp duty exemption for property transactions in Malaysia.

When and how stamp duty is paid

• Deadline: an instrument must be stamped within 30 days of the date it is signed in Malaysia (or within 30 days of being received in Malaysia if signed abroad).

• Assessment: stamping is done through LHDN's online system. Your lawyer normally submits the documents and pays the duty from the funds you provide.

• Self-assessment: LHDN is phasing in a Stamp Duty Self-Assessment System (STSDS). Phase 1 started on 1 January 2026 (tenancies and leases, securities and general stamping). Phase 2 starts on 1 January 2027 and covers transfers of real property that do not involve a JPPH (Valuation and Property Services Department) valuation. Phase 3 follows on 1 January 2028 for the remaining instruments. Your lawyer will tell you which process applies to your transfer.

What happens if stamp duty is not paid

There are two consequences:

1. Penalties. Under LHDN's current rules (effective 1 January 2025), stamping within 3 months after the deadline attracts a penalty of RM50 or 10% of the unpaid duty, whichever is higher. Stamping more than 3 months late attracts RM100 or 20% of the unpaid duty, whichever is higher.

2. The transfer cannot be registered. When Form 14A is presented at the land office to register your name on the title, the land office will not proceed without proof that stamp duty has been paid.

How ASCOLAW can help

ASCOLAW can calculate the stamp duty on your purchase and loan, check whether you qualify for the first-home exemption, and handle stamping and registration as part of your purchase. Fill in the ASCOLAW enquiry form below with the price and loan amount and our team will contact you. For the rest of your budget, see our guide to legal fees for buying and selling a house in Malaysia.

Frequently asked questions

Who pays stamp duty when buying a house in Malaysia?

The buyer usually pays the stamp duty on the instrument of transfer and on the loan agreement. The SPA can set out a different arrangement, but this is the normal practice.

Is stamp duty calculated on the purchase price?

It is calculated on the purchase price or the market value of the property, whichever is higher. If LHDN assesses a higher market value, you pay duty on that value.

How much is stamp duty on a RM500,000 house?

For a Malaysian buyer with no exemption, the stamp duty on the transfer is RM9,000 (RM1,000 on the first RM100,000 and RM8,000 on the next RM400,000). If there is also a loan, add 0.5% of the loan amount.

Does the first-home exemption apply to a house above RM500,000?

The Budget 2026 exemption applies to first homes priced up to RM500,000. Check the current exemption order for the conditions that apply to your purchase.

This article is general information only and is not legal advice. Stamp duty rates and exemptions are set by statute and government orders and can change, so check the current position with LHDN or your lawyer before you rely on any figure. Rates stated are as at September 2026.

Related guides

• Stamp Duty Exemption for Property Transaction in Malaysia

• Legal Fees for Buying and Selling a House in Malaysia (2026 Guide)

• Housing Loan & Loan Agreement Legal Fees in Malaysia

• Land Title Transfer Procedure in Malaysia

• Property lawyer services at ASCOLAW