What is Memorandum Of Transfer (MOT) in Malaysian Property?

Property Guides

Jul 5

A Memorandum of Transfer (MOT) is a legal document (Form 14A) to certify the official transfer of real estate ownership from the seller to the buyer. The buyer will be responsible for paying the cost of the MOT, including legal fees, stamp duty, disbursement fees, and sales and service tax.

In most circumstances, there are 2 scenarios for MOT.

New Development: Transfer of ownership from developer to a buyer
Secondary Market: Transfer of ownership from existing homeowner (seller) to new homeowner (buyer)

1.0 Memorandum of Transfer (MOT) Stamp Duty Calculation

Property Price
MOT Stamp Duty Fee


First RM100,000
1%

RM100,001 - RM500,000
2%

RM500,001 - RM1,000,000
3%

RM1,000,001+
4%

Here’s a sample calculation for a property priced at RM600,000.

First RM100,000 x 1% = RM 1,000
Next RM400,000 x 2% = RM8,000
Next RM100,000 x 3% = RM 3,000

= RM1,000 + RM8,000 + RM3,000

= RM12,000

If manual calculation is not something you enjoy, you can use a Malaysia MOT Calculator.

2.0 Exemption of Memorandum of Transfer (MOT) Stamp Duty Fee

There are situational conditions that allow the exemption of the MOT stamp duty fee, which means in special circumstances, there will be a full or partial waiver for stamp duty.

Transfer of Love and Affection
- Husband and Wife = 100% Exemption
- Parent and Child = 50% Exemption
- Siblings = 0% Exemption

Relationship
MOT Stamp Duty Exemption


Husband and Wife
100%

Parent and Child
50%

Siblings
0%

2. First-home Buyer

No longer valid at the moment
Under the Home Ownership Campaign (HOC) 2020/2021
HOC has ended on 31 December 2021
For residential homes priced between RM300,000 to RM2.5 million
Subject to a minimum 10% discount by the developer
Exemption on MOT is limited to the first RM1 million of the property price.

Property Price
MOT Stamp Duty Exemption


First RM100,000
0%

RM100,001 - RM500,000
0%

RM500,001 - RM1,000,000
0%

RM1,000,001 - RM2,500,00
3%

Let’s start with the first one, the transfer of love and affection. The name of this exemption sounds unique, and it is special. This waiver is only valid for the transfer of property between family members. The transfer from husband to wife, or vice versa, will be 100% exemption, meaning no MOT stamp duty fee is imposed. The transfer from parent to child, or vice versa, will be a 50% exemption. However, the transfer between siblings will not be eligible, equivalent to 0% exemption.

For example, assuming the property is priced at RM600,000, the MOT stamp duty fee is RM12,000. The charges for the husband and wife will be RM0, the parent and child will be RM6,000, and the siblings will be RM12,000.

Secondly, for first-time homebuyers, this exemption is a past initiative under the Home Ownership Campaign (HOC) by the Malaysian government back in 2020/2021 (no longer valid at the moment; ended on 31 December 2021). We are writing this in any event if anything similar happens in the future, you can find it here.

This exemption was targeted at residential homes priced between RM300,000 to RM2,500,000 with an exemption to the first RM1,000,000 of the property price and partial exemption for anything more than RM1,000,001. In other words, any first-home buyers purchasing a residential property between RM300,000 to RM1,000,000 will not be charged the MOT stamp duty fee.