Stamp Duty Exemption Malaysia 2026: First-Time Buyer Guide (Extended to 2027)
If your first home in Malaysia is priced at RM 500,000 or below, you can pay zero stamp duty on both the Memorandum of Transfer and the Loan Agreement — saving you upwards of RM 11,500. The exemption is extended until 31 December 2027 — but the cliff at RM 500,001 is real.
What exactly is exempted
Two stamp duties get the full waiver: (1) Memorandum of Transfer (MOT) stamp duty, normally 1% on the first RM 100k, 2% on RM 100k–500k. On a RM 500k purchase that's RM 9,000. (2) Loan Agreement stamp duty, normally 0.5% of the loan amount. On a 90% loan of RM 450k, that's RM 2,250. Combined exemption: ~RM 11,500 on a typical first home at the threshold.
Eligibility — who qualifies
Malaysian citizen. First residential property — you have not previously owned a residential title in your name (joint or sole). Property purchase price OR market value (whichever is higher) is RM 500,000 or below. Sale & Purchase Agreement signed and Memorandum of Transfer stamped before 31 December 2027. Permanent residents and foreigners do NOT qualify.
How to claim
Your appointed lawyer handles the claim during the stamping process at LHDN. You provide: NRIC (citizenship verification), a statutory declaration that this is your first residential property, and the SPA. The exemption is applied automatically once eligibility is confirmed. There is NO post-purchase refund mechanism — claim at stamping or lose it.
The RM 500,001 cliff
This is the most important detail most articles skip. The exemption is binary, not tiered. A property at RM 500,000 = full waiver. A property at RM 500,001 = full standard stamp duty (RM 9,000 MOT). For a single ringgit, you pay an extra RM 9,000+. If you're negotiating sub-sale: bring the price to RM 500,000 exactly. If you're bidding at auction: STOP at RM 500,000.
Auction-specific tactics
The exemption applies to auction wins. Your winning bid amount is the figure used to test the threshold. To preserve the exemption: your max bid card should read RM 500,000 — full stop. If competing bidders push past it, walk away. The mathematical loss is steep: paying RM 510k means losing RM 9,000 in exemption value, so the effective price is RM 519,000. The "discount" disappears.
Stacking with Skim Rumah Pertamaku (SRP)
For buyers aged 18–35 with single income up to RM 5,000/month (or joint up to RM 10,000), SRP guarantees up to 110% financing — including the legal fees and MOT. Combined with the stamp duty exemption, you can move into a RM 500,000 first home with under RM 5,000 cash out of pocket. Most under-35 buyers do not realise this stack exists.
What's NOT exempted
Real Property Gains Tax on resale (5–30% depending on holding period). Quit rent and assessment (annual taxes — small, but recurring). Outstanding maintenance and sinking fund arrears (transfer with the property — not government-related). Bank-side fees: valuation, legal disbursements, processing. The exemption is purely on the two stamp duty lines.
Comparison: 2025 vs 2026 vs 2027
The exemption was originally legislated to expire end-2025. The 2025 budget extended it to 31 December 2027. The threshold (RM 500k) and scope (first home, both stamp duties) remain unchanged. The Cabinet has the discretion to extend further or restructure — historically, similar schemes have been refined rather than scrapped, but plan around 2027 as a hard date for now.
Worked example: RM 380k auction win
Reserve price: RM 350,000. Winning bid: RM 380,000 (32 bidders, modest premium). Without exemption: stamp duty MOT = RM 100k×1% + RM 280k×2% = RM 5,600. Loan Agreement (90% loan): RM 342k × 0.5% = RM 1,710. Total stamp duty: RM 7,310. With first-time-buyer exemption: RM 0. Net savings: RM 7,310 — directly funded into renovation budget.
Worked example: RM 510k mistake
Reserve price: RM 480,000. Bidding war drives final to RM 510,000. Without exemption: stamp duty MOT = RM 9,200. Loan Agreement: RM 459k × 0.5% = RM 2,295. Total: RM 11,495. Effective property cost vs RM 500,000 stop-line: RM 510k + RM 11,495 = RM 521,495. The "extra RM 10k" actually cost RM 21,495. This happens to first-time bidders weekly. Don't be one.
Quick-reference cheatsheet
Eligibility: Malaysian citizen + first home + price ≤ RM 500,000 + stamped before 31 Dec 2027. Coverage: MOT + Loan Agreement = full waiver. Savings: ~RM 11,500 on a RM 500k home. Cliff: RM 500,001+ pays full stamp duty (no partial exemption). Stacks with: Skim Rumah Pertamaku (110% financing, ages 18–35). Beats: any pure cashback or rebate scheme on equivalent property tier.