Calculation of Real Property Gain Tax (RPGT) in Malaysia

How to calculate Real Property Gain Tax (RPGT) payable in Malaysia

For illustrate purpose, lets assume Mr A purchased a property on year 2006 at RM100,000 and sold after or on 1st Jan 2010 at RM180,000 (within five years of the date of purchase). After deducted RM30,000 allowable expenses, he made RM50,000 from the transaction and the gains are subject to 5% Real Property Gain Tax (RPGT)  and the calculation will be:

RM50,000 (Property Gains) – RM10,000 (Waived Exemption) = RM40,000 (Taxable Gains)

RM40,000 (Taxable Gains) x 5% (RPGT Rate) = RM2,000 (RPGT Chargeable)

Thus, the RPGT chargeable to Mr A will be RM2,000

Circumstances where the property owner is exempted from the 5% RPGT

* The exemption of RM10,000 or 10% of the chargeable gains, which ever is the higher

* Gifts between parent and child, husband and wife, grandparent and grandchild; and