First-Time Buyer Stamp Duty Exemption: What Qualifies and How to Claim It

First-time buyers in Malaysia can pay zero stamp duty on properties priced at RM500,000 or below, covering both the transfer instrument and the loan agreement. This exemption, most recently extended through Budget 2026 to 31 December 2027, can save eligible buyers between RM5,400 and RM11,250 depending on the purchase price.

This guide covers who qualifies, exactly how the numbers work at different price points, what happens when you buy above RM500,000, and the step-by-step process your conveyancing lawyer will follow to claim the exemption at LHDN.

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Why stamp duty matters for first-time buyers

When you buy a property with a bank loan in Malaysia, LHDN (Lembaga Hasil Dalam Negeri) applies stamp duty on two separate legal instruments:

1. The Memorandum of Transfer (MOT): transfers legal ownership from seller to buyer.
2. The loan or facility agreement: the contract between you and the bank.

Without an exemption, both instruments attract duty. For a RM500,000 purchase at 90% financing (RM450,000 loan), the standard amounts would be:

• MOT duty: RM9,000 (RM1,000 on the first RM100k + RM8,000 on the remaining RM400k)
• Loan agreement duty: RM2,250 (flat 0.5% of the loan)

Total saved under the first-home exemption: RM11,250.

For more on all the upfront costs involved in a Malaysian property purchase, see buying property costs in Malaysia.

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The full exemption: who qualifies

The exemption is governed by the Stamp Duty (Exemption) (No. 6) Order 2023, extended via Budget 2026 to cover Sale and Purchase Agreements (SPAs) signed from 1 January 2026 to 31 December 2027.

Core eligibility criteria

Condition	Requirement
Citizenship	Malaysian citizen only
First-time buyer status	Must never have owned any residential property in Malaysia, whether wholly or jointly, including property received as a gift
Property type	Residential property only (house, condominium, apartment, townhouse)
Property price	RM500,000 and below
SPA execution date	On or after 1 January 2026 and on or before 31 December 2027
Property market	Subsale (secondary) or primary (developer) market both qualify

The “never owned” test is applied strictly. If your name ever appeared on a property title in Malaysia, even briefly or as a co-owner, you are no longer a first-time buyer for this exemption. Joint buyers where one partner already owns property do not qualify for the exemption on that joint purchase.

Important: The trigger date is when the SPA is executed (signed), not when you pay the booking fee, get a loan approval letter, or complete the transaction. Plan your timeline accordingly.

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What the exemption covers: two instruments, one waiver

The exemption removes duty on both instruments in full for properties at or below RM500,000:

• MOT stamp duty: fully waived (would otherwise be up to RM9,000 on a RM500,000 home)
• Loan agreement stamp duty: fully waived (would otherwise be 0.5% of the loan amount)

The exemption does not cover legal fees charged by your conveyancing solicitor. Those are calculated separately under the Solicitors’ Remuneration Order 2023. See stamp duty and legal fees in Malaysia for the full fee scale.

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Savings by price point

The table below shows how much a first-time buyer saves at different purchase prices, assuming 90% financing.

Purchase price	Standard MOT duty	Standard loan duty (90%)	Total standard duty	First-home saving
RM300,000	RM5,000	RM1,350	RM6,350	RM6,350
RM400,000	RM7,000	RM1,800	RM8,800	RM8,800
RM500,000	RM9,000	RM2,250	RM11,250	RM11,250
RM600,000	RM12,000	RM2,700	RM14,700	No exemption

Source: LHDN standard Stamp Act 1949 rates; MOT duty is cumulative across bands. Figures rounded.

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What happens above RM500,000

There is no partial exemption tier above RM500,000 under the current scheme. If your purchase price is RM500,001 or above, the full standard stamp duty rates apply to both instruments. There is no graduated phase-out.

If you are deciding between two properties where one is priced just above RM500,000, the duty cliff is worth factoring into your negotiation. A seller willing to price at RM500,000 saves the buyer over RM11,000 in duty alone on a 90% loan.

For properties above RM500,000, first-time buyers may still qualify for other government assistance such as the My First Home Scheme (Skim Rumah Pertamaku) or PR1MA. See government home loan schemes in Malaysia for details on those programmes.

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How to claim the exemption: step by step

The exemption is not applied automatically at registration. It must be explicitly claimed through the stamping process, which your conveyancing lawyer handles on your behalf.

Step 1: Appoint a conveyancing solicitor

Your lawyer will prepare the SPA and the loan facility agreement. Inform them at the outset that you are a first-time buyer and intend to claim the exemption. A competent solicitor will already flag this, but confirming early avoids delays.

Step 2: Execute the SPA within the eligible window

Sign the SPA between 1 January 2026 and 31 December 2027. Your lawyer will note the execution date on the instrument, as this is what LHDN uses to confirm eligibility.

Step 3: Prepare the statutory declaration

You will need to sign a Statutory Declaration (Akuan Berkanun) confirming:

• You are a Malaysian citizen
• You have never previously owned any residential property in Malaysia, whether wholly or jointly

Your lawyer will draft this. It is signed before a Commissioner for Oaths or a magistrate. Provide your full MyKad copy and any supporting documentation your solicitor requests.

Step 4: Your lawyer submits to LHDN via e-Duti Setem

From 2026, all stamp duty instruments in Malaysia are submitted electronically through the LHDN e-Duti Setem system (accessible via the MyTax portal at mytax.hasil.gov.my). Your lawyer uploads the instrument, applies the exemption code, attaches your statutory declaration, and submits it for assessment.

LHDN will either approve the exemption automatically (for straightforward cases) or refer it for manual review. Processing time for approved cases is typically within a few working days.

Step 5: Retain the stamped instrument

Once approved, your lawyer receives the stamped instrument with an endorsement confirming the duty exemption. Keep a copy for your records. If LHDN ever queries your eligibility in a future audit, this document is your proof.

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Common mistakes to avoid

Booking fee paid, SPA delayed: If your developer or agent delays executing the SPA past the exemption window, you lose the benefit. Confirm the SPA execution date in writing before paying any booking fee.

Joint purchase with an existing owner: If your spouse or co-buyer already owns property, the exemption does not apply to the joint purchase. Structure the ownership carefully, and consult a solicitor before signing.

Treating commercial property as residential: Shop offices, serviced apartments with commercial land titles (particularly those with “Commercial” designation in the strata title), and shophouses do not qualify. Confirm the land title category with your solicitor.

Overseas property not counted: Previous ownership of property outside Malaysia does not disqualify you. The “never owned” test applies only to Malaysian residential property.

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Key takeaways

• First-time buyers in Malaysia pay zero stamp duty on residential properties priced at RM500,000 or below, covering both the MOT and the loan agreement.
• The exemption runs until 31 December 2027 for SPAs signed from 1 January 2026 (Budget 2026 extension).
• The maximum saving is approximately RM11,250 on a RM500,000 property with a 90% loan.
• There is no partial exemption above RM500,000. The benefit disappears entirely above this threshold.
• “First-time buyer” means you have never previously owned any residential property in Malaysia, including as a co-owner or gift recipient.
• Your conveyancing lawyer handles the LHDN e-Duti Setem submission. Your job is to sign the Statutory Declaration and provide your MyKad.
• The trigger date is SPA execution, not the booking fee payment or loan approval date.

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Frequently asked questions

Does the exemption apply if I buy with my spouse who already owns a property?

No. Both buyers on the SPA must be first-time buyers for the exemption to apply. If either party has previously owned residential property in Malaysia, the exemption is disqualified for that transaction.

Can I claim the exemption if I buy an auction property?

Generally yes, provided the instrument of transfer is executed within the eligible window and you meet the first-time buyer criteria. However, auction properties follow a different transaction structure (using a Proclamation of Sale rather than an SPA). Consult your solicitor on the specific documentation required for LHDN.

What if my property is RM501,000? Can I negotiate the price down to qualify?

Legally, yes. You and the seller are free to agree on a price at or below RM500,000. The SPA price is what LHDN uses, subject to LHDN assessing the market value independently. If LHDN determines the market value is significantly above the SPA price, they may stamp based on the higher assessed value, which could affect whether the exemption threshold is met.

Is the exemption available for subsale (secondary market) purchases?

Yes. The exemption applies to both new (primary market from developer) and subsale (secondary market) residential properties, as long as all other criteria are met.

What documents do I need to prepare personally?

Your main obligation is to provide your conveyancing solicitor with: a copy of your MyKad, confirmation that you have no existing residential property in Malaysia (your lawyer will verify this), and your signed Statutory Declaration. Your solicitor manages the LHDN submission on your behalf.