Real Property Gain Tax Malaysia: How to Calculate

Which RPGT page do you need? This cluster is deliberately split by intent, and RPGT Malaysia 2026: Rates by Year is the rate table most people are looking for.

• Rates for the current year → RPGT Malaysia 2026
• How the tax works, end to end → Malaysia RPGT complete guide
• Working out a specific disposal → How to calculate RPGT or the RPGT calculator
• Exemptions → RPGT exemptions guide
• Selling as a foreigner → Foreigner RPGT
• Inherited property → RPGT on inherited property

Real Property Gain Tax (RPGT) is the tax you pay on profit from selling property in Malaysia. It is not complicated, but miscalculating it — or not knowing about the exemptions — can cost you thousands of ringgit unnecessarily.

This guide walks through the RPGT calculation step by step, with a worked example, the two exemption methods, the filing process using CKHT forms, and the 60-day payment timeline.

The RPGT Formula

The calculation has three stages:

1. Chargeable Gain = Disposal Price - Acquisition Price - Allowable Expenses
2. Taxable Gain = Chargeable Gain - Exemption
3. RPGT Payable = Taxable Gain × RPGT Rate

Each component has specific rules about what counts and what does not.

Step 1: Determine the Disposal Price

The disposal price is the selling price in your Sale and Purchase Agreement (SPA). Not the market valuation. Not the bank's valuation. The contractual SPA price.

Exception: For transactions between related parties (e.g., selling to a family member at below market value), LHDN may substitute the market value as determined by a registered valuer. This prevents artificial underpricing to reduce RPGT.

Step 2: Determine the Acquisition Price

The acquisition price is your original purchase price from the SPA when you bought the property — plus certain costs directly related to the acquisition:

The acquisition price represents your total capital outlay to acquire the property, excluding financing costs and holding costs.

Step 3: Deduct Allowable Expenses

Allowable expenses are costs incurred to enhance the property or to execute the disposal:

Enhancement expenses (during holding period):

• Renovation that permanently improves the property — kitchen extensions, bathroom upgrades, built-in cabinetry, flooring replacement, electrical rewiring
• Must have original receipts and invoices
• Must be permanent improvements, not routine maintenance or repairs

Disposal expenses (at time of sale):

• Legal fees for the sale transaction
• Real estate agent commission (typically 2-3% of selling price)
• Valuation fees for the sale
• Advertising costs to sell the property

Not allowable:

• Routine repairs and maintenance (fixing leaks, repainting to original condition)
• Furniture, appliances, and movable fittings
• Mortgage interest payments
• Insurance premiums
• Quit rent and assessment rates
• Maintenance fees and sinking fund contributions

The distinction between renovation (deductible) and repair (not deductible) is important. Replacing a broken pipe is a repair. Repiping the entire unit with upgraded materials is renovation. LHDN applies this distinction strictly.

Step 4: Calculate the Chargeable Gain

Subtract acquisition price and allowable expenses from disposal price:

Chargeable Gain = Disposal Price - Acquisition Price - Allowable Expenses

If this number is negative, you have sold at a loss. No RPGT is payable, but you must still file the return.

Step 5: Apply the Exemption

For individuals (Malaysian citizens, permanent residents, and foreigners), LHDN applies an automatic exemption:

Exempt Amount = Greater of RM10,000 or 10% of Chargeable Gain

This is not a choice — LHDN automatically uses whichever is larger.

Companies do not qualify for this automatic exemption. They pay RPGT on the full chargeable gain.

Taxable Gain = Chargeable Gain - Exemption

Step 6: Apply the RPGT Rate

The rate depends on your holding period and residency status. For a complete rate table, see our RPGT complete guide.

Quick reference — Citizens & PRs:

• Years 1-3: 30%
• Year 4: 20%
• Year 5: 15%
• Year 6+: 0%

Quick reference — Foreigners:

• Years 1-5: 30%
• Year 6+: 10%

RPGT Payable = Taxable Gain × Applicable Rate

Worked Example: Full Calculation

Scenario: Mei Ling, a Malaysian citizen, bought a condo in Bangsar South in January 2022 for RM550,000. She sells it in March 2026 for RM720,000.

Holding Period

January 2022 to March 2026 = 4 years and 2 months. Four full years have passed, so the disposal falls in the 5th year, and the rate is 15% for a Malaysian citizen. The 20% band applies in the 4th year, not the 5th.

Acquisition Price Calculation

Allowable Expenses

RPGT Calculation

If Mei Ling had held into year 6, her RPGT would be RM0. Year 6 begins once five complete years have passed from the acquisition date, so for a January 2022 acquisition that is around January 2027, not 2028. Check the exact date on your SPA, because a few weeks either side changes the rate band.

The Once-in-Lifetime Exemption (Alternative to 10%/RM10K)

Malaysian citizens and PRs have an additional option: the once-in-lifetime private residence exemption. This exempts the entire chargeable gain — not just 10% or RM10,000, but the full amount.

Conditions:

• You must be a Malaysian citizen or PR
• The property must be your private residence
• You can only claim this once in your lifetime

In Mei Ling's example, if the Bangsar South condo was her primary residence, she could claim this exemption and pay RM0 RPGT regardless of the holding period. But she can never use this exemption again.

Strategic decision: If your chargeable gain is small (under RM100,000), consider whether the once-in-lifetime exemption is worth using. You may sell a more expensive property in the future with a larger gain. For the full analysis, read our RPGT exemption guide.

Filing Process — CKHT Forms

Who Files What

Both seller and buyer must file. This is a joint obligation — both parties are independently required to submit their respective forms.

Where to File

• Online: MyTax portal via e-CKHT (recommended — faster processing)
• In person: Any LHDN branch office
• By post: RPGT Processing Centre, LHDN

Documents to Attach

• Copy of disposal SPA
• Copy of original purchase SPA
• Proof of expenses (legal fee invoices, agent commission receipts, renovation invoices)
• Copy of seller's IC/passport
• Copy of buyer's IC/passport
• Bank statements showing receipt of payment (if applicable)

Payment Timeline — The 60-Day Rule

Everything revolves around 60 days from the date of disposal (the SPA signing date):

The Retention Mechanism (3%, 5% or 7%)

For a citizen or PR seller like Mei Ling, the buyer must withhold 3% of the total purchase price and pay it directly to LHDN. This is not 3% of the gain — it is 3% of the full price. The rate is 5% where the seller is a Malaysian company disposing within 3 years of acquisition (3% from the 4th year) and 7% where the seller is a foreign individual or a company not incorporated in Malaysia (section 21B).

In Mei Ling's example:

• 3% of RM720,000 = RM21,600 (retained by buyer, paid to LHDN)
• RPGT payable = RM12,228.75
• Refund to Mei Ling = RM21,600 - RM12,228.75 = RM9,371.25

LHDN refunds the difference after processing, which typically takes 2-4 months.

If the RPGT exceeds 3% of the purchase price, the seller must pay the shortfall directly. This is uncommon for individual transactions but can occur for short-term disposals with large gains.

Your Lawyer's Role

In practice, your conveyancing lawyer handles most of the RPGT process:

• Calculates the 3% retention
• Holds the retention sum in their client account
• Remits to LHDN on behalf of the buyer
• Assists with CKHT form preparation

Confirm with your lawyer that RPGT filing is included in their scope. Some charge an additional fee for RPGT form preparation. For details on legal costs, see our legal fees guide.

Common Calculation Mistakes

1. Forgetting to include stamp duty in acquisition price. Stamp duty paid on the original purchase is part of your acquisition cost. Including it reduces your chargeable gain.

2. Claiming furniture as renovation. Air conditioners, washing machines, sofas, and curtains are movable items — not deductible. Only permanent improvements to the structure qualify.

3. Using the wrong holding period. The holding period runs from your purchase SPA date to your sale SPA date. Not from key collection. Not from title transfer. SPA to SPA.

4. Not filing when selling at a loss. No RPGT due does not mean no filing required. Both parties must still submit CKHT forms within 60 days. Penalties for non-filing apply regardless of whether tax is owed.

5. Miscounting the year boundary. If you bought on 1 June 2021, "within 3 years" means a disposal SPA dated on or before 31 May 2024. A disposal on 1 June 2024 falls in year 4. Get the exact date right — it can mean the difference between 30% and 20% for citizens.

RPGT Calculator

For quick calculations, use our RPGT calculator guide which walks through the tool and covers edge cases like inherited properties and transfers between related parties.

You can also estimate your total property transaction costs — including RPGT, stamp duty, and legal fees — to understand the full picture before making a buy or sell decision.