Hi
With the proposed changes on RPGT in Budget 2013, please advise any impact on lease hold property (2 storey terrace house)to be disposed before 1 Jan 2013, considering property has been acquired approximately 4.5 years ago ( previous SPA dated Aug 2008).

If the disposal date is defined as the date when State consent has been obtained (instead of disposal SPA date), RPGT incurred would be 10% instead of 5%?

Thanks

My undderstanding is , the disposal date was told is the S&P date. Not the date of state consent obtained.

31/08/2008 365.00 31/8/2009 1 year
31/8/2009 365.00 31/8/2010 2 year
31/8/2010 365.00 31/8/2011 3 year
31/8/2011 365.00 30/8/2012 4th year
30/8/2012 365.00 30/8/2013**** 5th year

If you dispose before 1 Jan 2013 = RPGT is 5%,

If you dispose after 1 Jan 2013 = RPGT is 10%

so try to sign your s&p on our before 31.12.2012 to get lower RPGT.

This post has been edited by tikaram: Oct 12 2012, 03:00 PM

If 4.5 year need tax 5% only?

thanks for the response. need to confirm how LHDN consider the date of disposal, I.e. SPA vs Consent date. If it is Consent date, then may just hold the property few months, and free from RPGT.

Confirm, it's follow SPA date.

This post has been edited by ecin: Oct 13 2012, 08:11 AM

Hi, thanks for the response. I wish that too but found various interpretations by different people, eg:

http://www.iproperty.com.my/news/5061/real...-property-owner

http://tunheang.com/2012/02/06/acquisition...-date-for-rpgt/

Did you get confirmation from LHDN/IRB?

I'm sorry, I misunderstood it .. Normal procedure lawyer'll collect 2% upon signing SPA and do submission, both lease and freehold .. For the final IRB refund calculation, should be you're right.

This post has been edited by ecin: Oct 14 2012, 12:09 AM

My understanding is you can always stick to s&P date to your advantages, which is under your control.

If the date of consent is better, than you select the date of consent. Usually the LHDN "not frequent" follow the date of consent and use the s&p date instant.

You got to make sure you remit the $$ base on the s&p date( if you fall on 10%). If you need not pay so much ( base on date of consent, 5%) , you will get the refund.

If you remit lower, You caould get penalty for the different , i.e 10%. But usually lawyer will advice you / handle it for you.

This post has been edited by tikaram: Oct 15 2012, 08:38 AM

One may look into para 15 of Schedule 2 of the Real Property Gains Tax, wherein it states:-

(1) Except where this Schedule provides otherwise, a disposal of an asset
shall be deemed to take place—
(a) where there is a written agreement for the disposal of the asset, on
the date of such agreement; or
(b) where there is no written agreement, on the date of completion of the
disposal of the asset.

However, there is a conditional also, wherein para 16 of the same Schedule:-
16. Where—
(a) a contract for the disposal of an asset is conditional; and
(b) the condition is satisfied (by the exercise of a right under an option
or otherwise),
the acquisition and disposal of the asset shall be regarded as taking place at
the time the contract was made, unless the amount of the consideration depends
wholly or mainly on the value of the asset at the time when the condition is
satisfied in which case the acquisition and disposal shall be regarded as taking
place when the condition is satisfied.

The para 16 has been amended from:-
16. Where a contract for the disposal of an asset is conditional and the condition is satisfied (by the exercise of a right under an option or otherwise), the acquisition and disposal of the asset shall be regarded as taking place at the time the contract was made, unless-
a )the acquisition or disposal requires the approval by the Government or an authority or committee appointed by the Government, the date of disposal shall be the date of such approval; or
b )the approval referred to in subparagraph (a) is conditional, the date of disposal shall be the date when the last of all such conditions is satisfied.

Hopefully it helps u. As the law now stands, it is on the date of the agreement.

Hi
Just to share feedback after consultation with lawyers, was advised that for sale of leasehold property, the SPA is a conditional contract and state consent date shall be treated as the disposal date and not likely to obtain state consent before 1/1/2013 even if submit for approval now.

---

Added on October 15, 2012, 10:54 pmHi
So if the property for sale is on leasehold, para 16(a) shall take precedence, ie state consent date is the disposal date then?

Just to share feedback after consultation with lawyers, was advised that for sale of leasehold property, the SPA is a conditional contract and state consent date shall be treated as the disposal date and not likely to obtain state consent before 1/1/2013 even if submit for approval now.



This post has been edited by tonytyk: Oct 15 2012, 10:54 PM

Thanks for the info.

Initial, I though you wanted to sell to none bumi from your bumi unit. That's why you need to get consent.

But, now knowing your consent is bcs of " leasehold".

Your case, It is very straight forward sales right? most lawyer just forward the tax amount to LHDN base on S&P date.

I never bought leasehold.

This post has been edited by tikaram: Oct 16 2012, 12:05 PM