Hi all,

my dad is buying a property and is in the middle of signing the SPA. however, in the SPA, it stated that we pay 3% to the lawyer firm for RPGT and the rest of 6% to the seller. i wonder is this a normal practice? My dad is a very traditional people which has stubborn head. according to my dad, he should paying all 9% to the seller only as the RPGT doesn't concern to us.

so my question is,
1. does the 3% to lawyer firm and 6% to seller is normal practice?
2. or we can choose to pay all 9% to the seller? will there any sub-sequences?

3% is for retention sum. very normal in our lawyer's practice

It is the law that a sum equivalent to 3% from the Purchase Price is to be paid upfront to LHDN being the RPGT.

Whether the entire 9% is written in favor of the seller or in 3%/6% ratio shouldn't really be much of a concern. If your dad insist that he will only issue a cheque for 9% solely made in favor of the vendor then inform the solicitor to only release the 9% cheque to the vendor in simultaneous exchange of the vendor's cheque for the sum of 3% made in favor of the solicitors firm.

problem solved.

As mentioned by others, the 3% is a retention sum required to be retained under the law where RPGT is payable:-

http://www.malaysianbar.org.my/index.php?o...c_view&gid=4862

Thanks all. In the end, I managed to persuade my dad that it is normal practice. Thanks for the help

Yes, normal. Even though the 3% is addressed to lawyer, but your father actually pay to the seller. As mentioned, retention sum. If the seller if eligible for exemption, the lawyer will give to seller.

You must explained wisely to your father.

is normal