How Real Property Gains Tax (RPGT) works in Malaysia
RPGT is a tax on the profit you make when you sell (dispose of) real property in Malaysia — or shares in a real property company. It is governed by the Real Property Gains Tax Act 1976 and administered by LHDN (Lembaga Hasil Dalam Negeri). You only pay it on the gain, not the whole sale price, and only if you sell for more than you paid.
The basic formula
The taxable amount is your chargeable gain:
- Chargeable Gain = Disposal Price − Acquisition Price − Allowable Costs
The RPGT rate that applies to that gain depends on two things: how long you held the property (the holding period), and whether you are an individual (Malaysian citizen or PR), a company, or a non-citizen.
RPGT rates by holding period (2026)
| Disposed in… | Individual (Citizen/PR) | Company (MY) | Non-citizen / Foreigner |
|---|---|---|---|
| 1st – 3rd year | 30% | 30% | 30% |
| 4th year | 20% | 20% | 30% |
| 5th year | 15% | 15% | 30% |
| 6th year onwards | 0% | 10% | 10% |
The big takeaway: a Malaysian citizen or PR who holds a property for more than five years pays no RPGT at all. Companies and foreigners always pay at least 10%.
Exemptions for individuals
- RM10,000 or 10% of the chargeable gain, whichever is higher — automatically deducted from the gain of an individual before RPGT is calculated.
- Once-in-a-lifetime exemption — a Malaysian citizen or PR can claim a full exemption on the disposal of one private residence, once in their lifetime (Section 8, Schedule 4). The election is made on Form CKHT 3 and is irrevocable.
- Transfers between close family — gifts between husband and wife, or parent and child, can be treated as "no gain, no loss".
These individual exemptions do not apply to companies.
What counts as an allowable cost?
You can deduct expenses that are capital in nature and directly related to acquiring, enhancing, or selling the property:
- Legal fees and stamp duty when you bought.
- Real estate agent / brokerage commission and legal fees when you sell.
- Advertising and valuation costs incurred to find a buyer.
- Renovation or improvement works that add lasting value (a capital improvement) — not routine repairs.
Costs you cannot deduct include normal repairs and maintenance, quit rent and assessment, mortgage interest, and insurance — these are treated as running costs, not part of the gain.
Worked example
A Malaysian citizen buys a house for RM400,000 and sells it 2 years later for RM550,000. Buying costs RM12,000, selling costs RM16,500, capital renovation RM20,000.
- Chargeable gain = 550,000 − 400,000 − (12,000 + 16,500 + 20,000) = RM101,500
- Exemption = higher of RM10,000 or 10% × 101,500 = RM10,150
- Taxable gain = 101,500 − 10,150 = RM91,350
- Held under 3 years → rate 30% → RPGT = 91,350 × 30% = RM27,405
If the same person had instead held the property for more than 5 years, the rate would be 0% and no RPGT would be due.
How to use this calculator
- Pick your disposer type — Individual (citizen/PR), Company, or Foreigner.
- Enter your purchase and selling prices, and the dates you bought and sold (this sets your holding period and rate).
- Add your allowable costs — buying, selling and capital renovation.
- If you're an individual selling a private home and want to use your one-time exemption, tick the once-in-lifetime box.
- Read off your estimated RPGT payable and net gain after tax.