Real Property Gains Tax (RPGT) in Malaysia – Complete Guide

Real Property Gains Tax (RPGT) — known in Bahasa Malaysia as Cukai Keuntungan Harta Tanah (CKHT) — is a capital gains tax administered by the Inland Revenue Board (LHDN) on profits made from disposing of real property or shares in a Real Property Company (RPC) in Malaysia.

If you sell your property at a profit, RPGT applies to the chargeable gain (not the total sale price). The tax rate depends on how long you held the property and your citizenship category.

How is the Holding Period Counted?

The holding period starts from the date of the Sale and Purchase Agreement (SPA) of the original purchase, and ends on the date of the SPA of disposal. It is not based on the date of title transfer (MOT).

• If you bought on 15 March 2020 and sell on 20 April 2023 → disposal is in Year 4.
• If you bought on 1 January 2018 and sell on 10 February 2025 → disposal is in Year 7+ → 0% for Citizens/PRs.

Statutory Individual Exemption

Malaysian Citizens and PRs are entitled to a statutory exemption on each disposal:

This means even if your gain is RM50,000, your first RM5,000 (10%) is exempt, and the remaining RM45,000 is subject to tax. If the gain is RM8,000, the full RM8,000 is covered (since RM10,000 floor applies).

Additionally, citizens are entitled to a once-in-a-lifetime full exemption on the disposal of one private residence (Section 8, RPGT Act 1976). This must be applied for via LHDN.

Allowable Deductions (Reduce Your RPGT)

You can deduct the following from your disposal proceeds to reduce your chargeable gain:

Note: Routine maintenance, repairs, and furnishings are NOT deductible — only capital improvements that increase the property's value qualify.

How to File RPGT (CKHT)

• CKHT-1A: Filed by the disposer (seller). Must be submitted within 60 days of the date of disposal.
• CKHT-2A: Filed by the acquirer (buyer), confirming the 3% retention sum.
• Retention Sum: The buyer must retain 3% of the total disposal price and remit it to LHDN on behalf of the seller. This is an advance payment against potential RPGT.
• Forms and e-filing are available at MyTax (mytax.hasil.gov.my).