# RPGT Exemptions and the CKHT Forms

> The once-in-a-lifetime private residence exemption, family transfers that escape RPGT, which CKHT form to file, and the acquirer's duty to retain part of the price.

- Category: taxation
- Language: en
- Status: published
- Updated: 2026-07-20
- Canonical: https://negaraku.md/en/taxation/rpgt-exemptions

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The most valuable RPGT relief in the Act can be used exactly once, and most
people spend it on the wrong property — usually the first one they sell, which
is rarely the one with the biggest gain.

## The once-in-a-lifetime private residence exemption

Section 8 exempts a gain accruing to **an individual who is a citizen, or an
individual who is not a citizen but is a permanent resident**, on the disposal
of his private residence. Permanent residents qualify; this is routinely
misreported as citizens-only.

Paragraph 9(1) of Schedule 3 supplies the limit. The individual is entitled to
the exemption in respect of **one private residence only**, provided that:

- he **elects** that the exemption apply to that residence;
- on the election being made, **there is no further exemption** for the disposal
  of any of his other private residences; and
- the election **is in writing to the Director General and is irrevocable**.

Paragraph 9(2) blocks the election where an exemption was already granted under
repealed provisions of the Act or under the repealed Land Speculation Tax Act
1974.

If you own two properties and expect to sell both, model the gain on each before
electing. The relief cannot be undone.

## The Schedule 4 exemption

Separately, and available on every disposal rather than once, Schedule 4
exempts **RM10,000 or 10% of the chargeable gain, whichever is greater**, for a
chargeable gain accruing to an **individual**. Companies get nothing.

## Family transfers: a closed list

Paragraph 12(1) of Schedule 2 deems a gift to be a disposal at **market value**,
so a gift is normally a taxable event even though no money moves.

Paragraph 12(2) carves out transfers where the donor and recipient are **husband
and wife, parent and child, or grandparent and grandchild**. In those cases:

- the **donor is deemed to have received no gain and suffered no loss**, but
  only **if the donor is a citizen**; and
- the **recipient inherits the donor's acquisition price** plus the donor's
  permitted expenses.

Three things people get wrong here:

- **Siblings are not on the list.** Brother-to-sister transfers are taxed at
  market value. The list is closed.
- **The citizenship test attaches to the donor**, not the recipient.
- **The relief defers rather than forgives.** The recipient takes over the
  original cost, so the whole accumulated gain surfaces on their eventual sale.

Separately, paragraph 3(1)(b) deems disposal price to equal acquisition price
for transfers between spouses, between former spouses under a court order
dissolving a marriage, and certain transfers to a controlled company.

## Which CKHT form

| Form | Who files it | What it covers | Deadline |
| --- | --- | --- | --- |
| **CKHT 1A** | Disposer | Disposal of real property | 60 days from disposal |
| **CKHT 1B** | Disposer | Disposal of shares in a real property company | 60 days from disposal |
| **CKHT 2A** | Acquirer | Acquisition of real property or RPC shares | 60 days from acquisition |
| **CKHT 3** | Disposer | Notification under s.13(6) that the disposal is not chargeable or is exempt | 60 days from disposal |

The private residence election is made through **CKHT 3**.

## The acquirer's retention duty

Under s.21B the **acquirer** — not the seller — must retain part of the
consideration and pay it to the Director General **within 60 days** of the
disposal:

- **3%** as the default, under s.21B(1);
- **5%** where the disposer falls under Part II of Schedule 5 **and the disposal
  is within three years** of the acquisition date, under s.21B(1A)(a) — reverting
  to 3% thereafter;
- **7%** where the disposer falls under Part III, under s.21B(1A)(b).

Failure to pay increases the amount by **10%** under s.21B(2), and that sum is a
debt due from the **acquirer** to the Government, payable forthwith.

The escape route is s.21B(5): where the disposer serves a valid **CKHT 3**
notice on the acquirer within 60 days, the retention duty does not apply at all.
If the acquirer under-remits because the disposer's CKHT 3 was wrong, s.14(5)
shifts the 10% onto the **disposer**.

## Common mistakes

- **Electing the private residence exemption on the first sale by reflex.** It
  is irrevocable and can only be used once.
- **Assuming siblings qualify for the love-and-affection treatment.** They do not.
- **Treating the family transfer as a permanent saving.** It rolls the gain
  forward into the recipient's hands.
- **Buyers ignoring the retention duty.** The 10% increase lands on the buyer.
- **Filing CKHT 3 late.** Serve it inside 60 days or the retention obligation
  stays live regardless of the exemption.

## What's next

Decide which property the once-in-a-lifetime election is worth spending on
before any sale completes, and get the CKHT 3 to the buyer's solicitor inside
the 60-day window so the retention is never triggered. Where the disposer is a
company, none of these exemptions apply.

## Sources

- Real Property Gains Tax Act 1976 (Act 169), consolidated text — https://lom.agc.gov.my/act-detail.php?act=169 (Attorney General's Chambers)
- RPGT Exemption — https://www.hasil.gov.my/en/ckht/pengecualian/ (LHDN)
- Types of RPGT Return Forms — https://www.hasil.gov.my/en/ckht/jenis-borang-nyata-ckht/ (LHDN)
- Retention and Remittance of Money by Acquirer — https://www.hasil.gov.my/en/ckht/pegangan-dan-remitan-wang-oleh-pemeroleh/ (LHDN)

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