RPGT Exemption Application (Malaysia)

A RPGT Exemption Application in Malaysia records the information required to apply for the registration or permit involved.

RPGT in Malaysia is governed by the Real Property Gains Tax Act 1976 (Act 169), which imposes a capital gains tax on profits from the disposal of real property situated in Malaysia or shares in a real property company (RPC). The Act was substantially amended by the Finance Act 2021, which reintroduced RPGT at 5% for disposals by Malaysian citizens and permanent residents after five years of ownership, and at 10% for disposals by non-citizens and companies after five years. Disposals within five years attract higher rates — up to 30% for disposals within three years of acquisition.

The RPGT Act 1976 Schedule 4 provides several categories of exemption that a disposer may claim by written application. The most widely used exemption is the once-in-a-lifetime exemption for Malaysian citizens and permanent residents disposing of a private residence — available once per lifetime under paragraph 2 of Schedule 4 of the RPGT Act 1976. Additional exemptions exist for low-cost housing disposals, government-to-private transfers, and gifts between spouses, parents, and children under Paragraph 9 of Schedule 4.

An RPGT Exemption Application must be filed within 60 days of the date of disposal (execution of the Sale and Purchase Agreement) as required under Section 13 of the RPGT Act 1976. LHDN processes exemption applications through its RPGT e-Filing portal (e-CKHT) or manually at the nearest LHDN branch. Failure to file within the 60-day period renders the disposer liable to a penalty under Section 29 of the RPGT Act 1976 of up to three times the amount of tax chargeable.

The RPGT Exemption Application must be accompanied by the CKHT 1A form (for individuals) or CKHT 1B form (for companies), together with supporting documents including a copy of the Sale and Purchase Agreement, proof of acquisition cost, and evidence supporting the exemption category claimed.

The legal framework governing the RPGT Exemption Application (Malaysia) in Malaysia draws on several key statutes and regulatory bodies. Under Malaysian law, the Contracts Act 1950 (Act 136) governs contractual obligations. The Companies Act 2016 (Act 777) regulates corporate entities through the Companies Commission of Malaysia (SSM). The Employment Act 1955 (Act 265) and the Department of Labour govern employment matters. The Personal Data Protection Act 2010 (Act 709) and the Personal Data Protection Department protect personal data. The Inland Revenue Board of Malaysia (LHDN) administers tax obligations. The Industrial Court adjudicates employment disputes under the Industrial Relations Act 1967 (Act 177). Parties executing a RPGT Exemption Application (Malaysia) in Malaysia should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Real Property Gains Tax Act 1976 (Act 169) sets the foundational requirements.

An RPGT Exemption Application in Malaysia is required whenever a property disposer qualifies for a statutory exemption under the Real Property Gains Tax Act 1976 and wishes to avoid the withholding obligation that applies to property disposals.

An RPGT Exemption Application is needed when a Malaysian citizen or permanent resident disposes of a private residential property and is claiming the once-in-a-lifetime residential exemption under Paragraph 2, Schedule 4 of the RPGT Act 1976. The exemption applies to gains from disposal of one private residence per lifetime and reduces the chargeable gain to nil. The disposer must never have claimed this exemption before.

An RPGT Exemption Application is required when a property is transferred as a gift between spouses, or between parent and child (including adopted children), under Paragraph 9 of Schedule 4 of the RPGT Act 1976. Gift transfers within these family relationships are treated as disposed at acquisition price — generating a nil gain — but the exemption must still be formally claimed through LHDN to release the acquirer from RPGT liability on a subsequent disposal.

An RPGT Exemption Application is needed when a Malaysian government authority, statutory body, or local authority (Pihak Berkuasa Tempatan) disposes of land to a private party as part of a housing development scheme or land reclassification, where the disposal qualifies for exemption under Section 8 of the RPGT Act 1976.

An RPGT Exemption Application is required by developers who dispose of units in a low-cost housing scheme approved under the Housing Development (Control and Licensing) Act 1966 (Act 118), where the disposal price is fixed below the market threshold set by the Ministry of Housing and Local Government (KPKT).

An RPGT Exemption Application is needed when the disposal is compulsory — such as acquisition under the Land Acquisition Act 1960 (Act 486) by the government or a statutory body — as compulsory acquisitions are exempt from RPGT under Section 8(3) of the RPGT Act 1976.

A complete RPGT Exemption Application for Malaysia must contain the following essential components to satisfy LHDN requirements under the Real Property Gains Tax Act 1976.

Disposer identification: Full legal name, MyKad number (for Malaysian citizens and permanent residents) or passport number (for non-citizens), address, and tax identification number (TIN) as registered with LHDN. For corporate disposers, the company registration number issued by the Companies Commission of Malaysia (SSM) and the company's Income Tax reference number.

Property details: Full address and description of the property disposed of, including the lot number, title type (individual, strata, or master title), state, and district. The Geran (title) number or Geran Mukim number, and the assessed annual value as per the relevant local authority (PBT) must be stated.

Disposal particulars: Date of disposal (date of execution of the Sale and Purchase Agreement), disposal price, and the name and MyKad or SSM number of the acquirer. The disposal price must match the consideration stated in the stamped Sale and Purchase Agreement.

Acquisition particulars: Date of acquisition, acquisition price (including incidental costs such as stamp duty, legal fees, and renovation costs qualifying as allowable expenditure under Section 4 of the RPGT Act 1976), and the title reference of the original acquisition instrument.

Exemption ground claimed: The specific paragraph of Schedule 4 or Section 8 of the RPGT Act 1976 relied upon, with a brief statement of facts supporting the claim. For the once-in-a-lifetime residential exemption, a statutory declaration (akuan berkanun) that the disposer has not previously claimed the exemption is required.

RPGT computation: A calculation of the chargeable gain (disposal price minus acquisition price minus allowable expenditure), the applicable RPGT rate, and the amount of tax that would otherwise be chargeable but for the exemption claimed.

Supporting documents schedule: A list of all attachments including the Sale and Purchase Agreement, title document, MyKad copies, previous acquisition documents, and statutory declarations. LHDN may require originals or certified true copies.

Additional compliance elements for a RPGT Exemption Application (Malaysia) used in Malaysia include: Under Malaysian law, the Contracts Act 1950 (Act 136) governs contractual obligations. The Companies Act 2016 (Act 777) regulates corporate entities through the Companies Commission of Malaysia (SSM). The Employment Act 1955 (Act 265) and the Department of Labour govern employment matters. The Personal Data Protection Act 2010 (Act 709) and the Personal Data Protection Department protect personal data. The Inland Revenue Board of Malaysia (LHDN) administers tax obligations. The Industrial Court adjudicates employment disputes under the Industrial Relations Act 1967 (Act 177). Forms-legal.com provides this template as a starting point for Malaysia-compliant documentation.