Fill out a CKHT 1A (Disposal of Real Property) form. Along with this, you have to include the sale and purchase agreement. You may also include any other. made in the prescribed CKHT 1A and CKHT 2A forms respectively to the Director If there is no tax payable, prescribed CKHT 3 has to be submitted to the. a) CKHT 1A – Pelupus; b) CKHT 2A – Pemeroleh c) CKHT 3 – Pelupus (i.e: disposal of property not subject to tax or exempted) d) CKHT – Pelupus (i.e.
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How much tax do I have to pay?
Any vendor who sells their property is required to pay RPGT. The Finance Act sets out the current prescribed tax rate as follows. This is applicable when the seller is disposing of the property within five years of signing the sale and purchase agreement.
There is no requirement that this entitlement must be exercised on your first-ever property disposal, thus you can decide to use the exemption for any future disposal.
However, you must inform your lawyer of such an intention before the sale and purchase agreement is drafted. How do I calculate chargeable gains and allowable losses? Or, heaven forbid, you have to sell, but the price has dropped.
There are three scenarios under the RPGT regime: Thus, where there is a chargeable gain upon disposal of any real property, then RPGT is ckhtt according to the rates in the table above.
However, in calculating chargeable gain, the seller cmht allowed to deduct from the chargeable amount certain expenses as follows: Where there is an allowable loss, tax relief is allowed to the seller for that year of assessment in an amount equal to the sum arrived at by applying the table above.
When can I get a refund? The norm is for the seller to receive a cheque for the refunded amount in the postbox. What if I calculate my payable tax wrongly? The lawyer overseeing the sale and purchase agreement between seller and buyer will normally charge ckhht nominal fee to file their respective CKHT forms.
Procedure For Filing Real Property Gains Tax Form | Malaysian Taxation
While seller and purchaser can save costs by filing the forms themselves, bear in mind there is a penalty for making incorrect returns. This can happen if you omit particulars relating to any disposal of chargeable assets; miscalculate the chargeable gains; or overstate the allowable loss. The penalty is a fine not exceeding RM5, and a special penalty of double the amount of the tax which has been undercharged.
There were no adjustments to RPGT rates for Budgetso investors can now better plan and calculate whether their return on investment will justify selling their property because prices are no longer appreciating as vigorously as a few years back.
Chris Tan is a lawyer, author, speaker and keen observer of real estate locally and abroad. He is founder and managing partner of Chur Associates. If you have questions for Chris Tan, please go to the Tips section of theedgeproperty.
The information here does not constitute legal advice. Please seek professional help for your specific needs.
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Malaysian Taxation 101
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