Property Inheritance in Malaysia: Wills, Faraid, and Transfer of Title

When a family member dies leaving behind a property in Malaysia, two questions come first: who is entitled to it, and how do you put the title in their name? The answers depend on whether the deceased was Muslim or non-Muslim, whether a valid will exists, and the total value of the estate. This guide walks through every scenario clearly.

See this topic for the full Selling and Owning hub, and how RPGT works when you sell for what happens if you later dispose of an inherited property.

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Why inheritance is more complicated than it looks

Malaysian property law intersects with at least three separate legal regimes depending on your situation:

• Faraid (Islamic inheritance law) for Muslim estates
• Distribution Act 1958 for non-Muslim intestate (no will) estates
• Probate and Administration Act 1959 and the Small Estates (Distribution) Act 1955 for the court and administrative process

Each regime has its own distribution rules, its own timelines, and its own government body that handles the paperwork. Getting the wrong process is a common and costly mistake.

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Two frameworks: Muslim and non-Muslim

For Muslims: Faraid plus planning tools

Faraid is the Islamic inheritance framework derived from the Quran (Surah An-Nisa 4:11-12) and enforced under Syariah law in Malaysia. Key principles:

• Fixed shares are prescribed for specific heirs: spouse, children (sons receive twice the share of daughters), parents, and siblings depending on who survives.
• Funeral expenses and outstanding debts are settled first, before any distribution.
• Faraid shares are mandatory and cannot be reduced by a will for the portion that falls under the Faraid rules.

The one-third rule for wasiat. A Muslim may write a wasiat (Islamic will) to direct up to one-third of their estate to non-Faraid beneficiaries or charitable causes. The remaining two-thirds (or more) must still follow Faraid. A wasiat must be in writing, made while the person is of sound mind, and compliant with Syariah principles.

Hibah: the lifetime gift tool. A hibah is a gift made during the owner’s lifetime, not at death. Because the asset transfers ownership while the giver is alive, it bypasses Faraid entirely and is not subject to the one-third limit. Hibah is a popular planning tool for parents who want to ensure a specific child receives the family home. However, delivery of the asset (or constructive delivery, via documents) is legally required for a valid hibah.

What happens without a wasiat. If a Muslim dies intestate, the entire estate is distributed according to Faraid. In practice, this can create complex co-ownership among multiple heirs, making later sale or renovation decisions difficult without unanimous consent.

For non-Muslims: Distribution Act 1958 or a will

If a non-Muslim dies without leaving a valid will, the Distribution Act 1958 (Act 300) determines who inherits and in what shares.

Survivors	Spouse	Children	Parents
Spouse + children + parents	1/4	1/2	1/4
Spouse + children (no parents)	1/3	2/3	,
Spouse + parents (no children)	1/2	,	1/2
Children only (no spouse, no parents)	,	All equally	,
Spouse only	All	,	,

Source: Distribution Act 1958 (Act 300), Malaysia.

With a valid will. A non-Muslim who leaves a valid will can distribute their estate to anyone in any proportion, subject only to the probate process. The will names an executor who applies to the High Court for a Grant of Probate.

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Three routes to administer the estate

Once it is clear who inherits, the next step is formal estate administration. There are three routes depending on the estate’s size and composition.

Route 1: Small Estates Distribution Unit (JKPTG) for immovable property up to RM2 million

If the estate includes immovable property (land, house, apartment) and the total value does not exceed RM2 million, the Small Estates (Distribution) Act 1955 applies. Application is made at the Estate Distribution Unit of the Department of the Director-General of Lands and Mines (Jabatan Ketua Pengarah Tanah dan Galian, or JKPTG) or the Land Office where the property sits.

Key features:

• Applies to both Muslim and non-Muslim estates.
• No lawyer is required (lawyers are generally not permitted at the hearing).
• No filing fee is charged by the Land Office.
• The unit issues a Distribution Order, which is then registered at the Land Office to effect the title transfer.

This is typically the fastest and cheapest route for residential properties below RM2 million.

Route 2: Amanah Raya Berhad (ARB) for movable assets up to RM600,000 (or as trustee for any estate)

Amanah Raya Berhad is the government-linked public trustee. Its two roles in estate administration are:

1. Small estates with only movable assets (no land or building) valued up to RM600,000: ARB administers these directly without going to court.
2. Executor or administrator for any estate: ARB can be appointed as executor in your will, or as administrator when no executor is named, for estates of any size.

ARB’s fee structure (as published on amanahraya.my):

Estate value band	Rate
First RM25,000	5%
Next RM225,000 (up to RM250,000 total)	4%
Next RM250,000 (up to RM500,000 total)	3%
Next RM500,000 (up to RM1,000,000 total)	2%
Remainder above RM1,000,000	1%

Minimum fee: RM50 for estates valued at RM3,000 and below. Source: Amanah Raya Berhad, 2025.

ARB also offers a product called Pewarisan Bertakaful, a takaful plan that covers the estate administration fee, starting from around RM10 per month.

Route 3: High Court probate or letters of administration for large or complex estates

Estates involving immovable property above RM2 million, or any estate where there is a valid will naming an executor, are handled through the High Court of Malaya under the Probate and Administration Act 1959.

• Grant of Probate (GP): issued when a valid will exists and names an executor. Typical timeline is three to five months. Court filing fee is approximately RM1,500, plus legal fees.
• Letters of Administration (LA): issued when there is no will (intestate). The court appoints an administrator, usually the next of kin. Typical timeline is six to twelve months, sometimes longer for contested or complex estates. Total costs including legal fees can start at several thousand ringgit.

A solicitor is almost always engaged for High Court probate work.

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Transferring the title after administration

Once you have a Distribution Order (small estate), a Grant of Probate, or Letters of Administration, the title can be transferred at the Land Office. The key steps:

1. Clear all arrears: All outstanding quit rent (cukai tanah) and assessment tax (cukai taksiran) on the property must be settled before any transfer is registered.
2. Stamp duty on the Memorandum of Transfer: Inheritance transfers attract a nominal stamp duty of RM10 per transfer (not the standard ad valorem rate). This applies to the transfer from the estate to the named beneficiary. Source: LHDN.
3. RPGT: The transfer itself from the deceased’s estate to a beneficiary is not a disposal for Real Property Gains Tax (RPGT) purposes. No RPGT is payable at this stage. Source: LHDN, “Transfer of Asset Inherited from Deceased Estate.”
4. Acquisition price reset: Under Schedule 2 of the Real Property Gains Tax Act 1976, the beneficiary’s acquisition price is the market value of the property at the date of the deceased’s death, not the original purchase price. A registered valuer’s report is typically required to establish this figure.
5. Holding period reset: The holding period for future RPGT purposes runs from the date of death, not the deceased’s original purchase date.

Practical implication: if a Malaysian citizen later sells the inherited property more than five years after the date of death, the RPGT rate is 0% (as per the RPGT rate schedule effective 1 January 2022 for citizens). Under the Self-Assessment System for RPGT (STS RPGT), which took effect 1 January 2025, the seller must compute the chargeable gain, submit the RPGT Return Form, and pay any amount due within 90 days of disposal. Source: LHDN, 2025.

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Common problems to plan around

Frozen assets. Bank accounts and property titles in the sole name of the deceased become inaccessible until administration is complete. This can take six months or more. Some financial institutions release small amounts on compassionate grounds, but most do not.

Multiple co-owners from Faraid. A family home distributed among five siblings according to Faraid shares creates five co-owners. Selling, renting, or renovating then requires unanimous (or majority, depending on the act) agreement among all. Estate planning tools like hibah or a well-drafted wasiat can prevent this scenario.

Delays from disputes. Contested distributions, missing beneficiaries, or incomplete documentation extend timelines significantly. The Land Office recommends applying within two years of death where possible.

Joint ownership survivorship. Property held under a joint tenancy (bukan pemilik bersama saksama) passes automatically to the surviving joint owner by the right of survivorship, outside the estate entirely. This is a different outcome from tenancy in common, where each owner’s share forms part of their estate. Confirm how your property is held before assuming it will pass by survivorship.

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Key takeaways

• Malaysia has no inheritance tax as of 2026; the Estate Duty was abolished in 1991.
• Muslims must follow Faraid for most of their estate; a wasiat can direct up to one-third elsewhere; hibah (lifetime gift) bypasses Faraid entirely.
• Non-Muslims without a will are governed by the Distribution Act 1958, with fixed shares for spouse, children, and parents.
• For residential properties below RM2 million, the small estate route via JKPTG is the cheapest and fastest path.
• Amanah Raya Berhad administers movable-asset-only estates up to RM600,000 and can serve as executor for any estate.
• The title transfer to a beneficiary attracts only RM10 stamp duty and triggers no RPGT at that stage.
• The beneficiary’s acquisition price for future RPGT purposes is the market value at the date of death, with the holding period starting from that date.
• Joint tenancy property passes by survivorship outside the estate; tenancy in common does not.

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Frequently asked questions

Is there inheritance tax in Malaysia?

No. Malaysia abolished estate duty on 1 November 1991 and has not introduced a replacement inheritance or estate tax since. Inherited property is not subject to tax at the point of inheritance, though RPGT may apply when the beneficiary later sells the property.

Can a Muslim leave their property to anyone they choose?

Partially. A Muslim can use a wasiat to direct up to one-third of the estate to non-Faraid beneficiaries, such as a non-Muslim spouse, a charity, or a non-inheriting relative. The remaining two-thirds must be distributed according to Faraid shares. To move assets outside Faraid entirely, a hibah (lifetime gift) made before death is the main vehicle.

How long does property inheritance take in Malaysia?

The small estate (JKPTG) route for properties below RM2 million is typically the fastest, often concluded in a few months. High Court Grant of Probate takes three to five months when a will exists; Letters of Administration without a will typically take six to twelve months or longer. Disputes, missing documents, and large numbers of beneficiaries extend all timelines.

Do I pay stamp duty when inheriting property?

Yes, but only a nominal RM10 stamp duty applies to the Memorandum of Transfer when property passes from an estate to a beneficiary, compared to the standard tiered ad valorem rates that apply to arm’s length sales. All outstanding quit rent and assessment must be cleared before the Land Office will register the transfer.

What is the RPGT position when I eventually sell inherited property?

No RPGT is due on the initial inheritance transfer itself. When you later sell, your acquisition cost is the market value at the date of the deceased’s death (not the original purchase price), and your holding period starts from that date. If you sell more than five years from the date of death as a Malaysian citizen, the RPGT rate is 0%. From 1 January 2025, RPGT is on a self-assessment basis: you calculate the gain, file the return form, and pay within 90 days of the sale. Source: LHDN.