Real Property Gains Tax (RPGT)
Scenario
Michel, a foreign pop singer residing in the States, has purchased a bungalow in Kuala Lumpur worth RM5million in 2012. He intended to dispose the property to a local billionaire, Jackson who offered him a handsome profit. However, due to the increase in RPGT rate for foreigners in 2014, Michel decided to put a halt on selling the bungalow. While anticipating for a drop in RPGT rate during Budget 2015, no announcement was made to that effect. Anxious to purchase the bungalow, Jackson informed Michel that no RPGT is applicable in 2015 since the Budget is silence on the matter. Is that true?
Mythbusted.
Thus, if Michel decided to sell the bungalow to Jackson in 2015, a 30% RPGT will be applicable to the profit that he earns in the transaction. In any event if he is selling the bungalow in 2016, the Government has proposed that RPGT will then be self-assessed.
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