How To Save Money on Property Transfer Before a Divorce in Malaysia

How To Save Money on Property Transfer Before a Divorce in Malaysia

Both you and your spouse have agreed to get a divorce in Malaysia. The divorce is mutual, and both of you have come to an agreement on all the divorce terms, including the transfer of properties from one to the other after the divorce.

However, you may think that the cost of transferring properties, including the legal fees and applicable stamp duty, will be high. You may be wondering if there is any way to save costs for property transfer in Malaysia during the course of a divorce.

So, is there a way to save on these costs? It is possible.

If you intend to get a divorce in Malaysia and both parties agree to transfer any real estate properties (specifically matrimonial assets) between each other, both parties are advised to transfer the properties prior to the divorce in order to save costs.

So how can you save costs?

Essentially, you may apply for an exemption from stamp duty applicable for property transfers in Malaysia if you are qualified to do so. This exemption from stamp duty for property transfers in Malaysia is given for transfers done under love and affection between legally married husband/wife or parents/children in Malaysia.

It is important to note that there shall be no exemption applicable if the property is sold for money to any other person in good faith, as the exemption is only applicable if it can be demonstrated to be a gift based on love and affection.

Also, it is essential to note that this exemption must be applied to the relevant authority, specifically to the Inland Revenue Board of Malaysia (LHDN), and is subject to the approval of the said authority.

In short, if you are contemplating to get a divorce and both of you have agreed to transfer any matrimonial property between each other, it is best done before filing the divorce petition to save your money specifically on the stamp duty payable.

This article discusses potential exemption from stamp duty in Malaysia. While the information provided is based on current laws and regulations, please be aware that the granting of stamp duty exemptions is ultimately at the discretion of the Inland Revenue Board of Malaysia (LHDN). LHDN will consider the specific circumstances of each transaction when determining whether an exemption applies.

You are advised to speak to a qualified lawyer in Malaysia to discuss your situation for a better understanding before you take any action. You may get more information from our lawyer based on your current circumstances in order for our lawyer to advice you accordingly.

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