Personal Finance Term
Stamp Duty
A government tax on legal documents, most commonly the property transfer instrument and the loan agreement when you buy a home. It is one of the larger upfront cash costs of a property purchase.
When buying property in Malaysia you generally pay stamp duty twice: on the Memorandum of Transfer (MOT) that transfers ownership, charged on a tiered ad valorem scale based on the property's value, and on the loan agreement, charged as a flat percentage of the loan amount. Because MOT duty is tiered, the effective rate rises with the price of the property, making it a significant cost on higher-value homes.
First-time buyers and certain price bands periodically receive stamp duty exemptions or discounts announced in the national Budget, so check the current incentives before signing — these change from year to year. Stamp duty also applies to other instruments such as tenancy agreements and share transfers. Budget for it in cash alongside the down payment and legal fees, as it usually cannot be financed into the home loan.