Legal Fee and Stamp Duty Calculation

Legal Fees Payable in Buying or Selling a Property

The legal fees payable to a lawyer acting for you when you buy or sell a property is calculated based on the purchase price as follows:-
- For the first RM 150,000, the legal fees payable is 1%
- For the next RM 850,000, the legal fees payable is 0.7%
- For the next RM 2,000,000, the legal fees payable is 0.6%
- For the next RM 2,000,000, the legal fees payable is 0.5%
- For the next RM 2,500,000, the legal fees payable is 0.4%
- For the remaining, if any, negotiable
No discount rule
According to Solicitors’ Remuneration Order, lawyers are strictly not allowed to give discount in conveyance matters.

Stamp duty payable on Memorandum of Transfer

A purchaser of a property has to stamp duty to the government when he buys a property.
How to calculate the stamp duty payable?
The stamp duty chargeable on the Sale and Purchase Agreement is RM10 each.
The stamp duty chargeable on the Memorandum of Transfer is calculated based on the purchase price as follow:-
- For the first RM 100,000, the stamp duty payable is 1%
- For the next RM 400,000, the stamp duty payable is 2%
- For any sum exceeding RM 500,000, the stamp duty payable is 3%

How to calculate stamp duty payable

For example, the stamp duty on Memorandum of Transfer for a property worth RM850,000 is calculated as follow:-

FIRST RM100,000 - RM100 x 1% = RM1,000
NEXT RM400,000 - RM400,000 x 2% = RM8,000
BALANCE RM350,000 - RM350,000 x 3% = RM10,500
TOTAL STAMP DUTY PAYABLE: RM18,500

In case of the purchaser is taking a loan and charged the property as a security, it is common practice now to treat the Loan or Facility Agreement as principal instrument and the charge as subsidiary instrument. In the aforesaid circumstances, the principal instrument will be charged with ad valorem duty whereas the subsidiary instrument will be charged only RM10.
The stamp duty chargeable on the Loan or Facility Agreement is calculated based on the purchase price as follow:-
- For any sum, the stamp duty payable is 0.5%
RM850,000 x 0.5% = RM4,250

Penalty on document not stamped within time

 

If a document is not stamped within the time frame, the purchaser will have to pay, in addition to the stamp duty payable, a penalty and the rates of the
penalty are as follows:-
(i) RM25 or 5% of the duty, whichever shall be greater, if the same is stamped within three months after the time of stamping;
(ii) RM50 or 10% of the duty, whichever shall be greater, if the same is stamped later than three months but not later than six months after the time of
stamping;
(iii) RM100 or 20% of the duty, whichever shall be greater, if the same is stamped later than six months after the time of stamping.
The purchaser may appeal to the Collector of Stamp Duties for reduction of penalty

Consequences of a document not duly stamped

 

A document which is not stamped or insufficiently stamped is not void or unenforceable for that reason alone. However, such document may be rejected as evidence if it is required to be produced before the Court. In that event, the party who wishes to produce the unstamped or insufficiently stamped document will have to pay the stamp duty payable and penalty before such document can be received as evidence.