What is Quit Rent?
Quit rent is the land tax imposed on owners of qualifying properties by the respective state governments, also known as Cukai Tanah (in Bahasa Melayu). The state government’s Land Office would assess and evaluate the land on which the property is situated and the owner of the property will need to pay the quit rent annually.
How is Quit Rent Calculated?
Quit Rent = Size of Property x Rate (according to each state)
For instance, if the specified rate is RM0.05 per square feet and your property is 1,855 sq ft, your quit rent would be RM92.75 (RM0.05 X 1,855).
But do take note that the quit rent would not necessarily be the same for all properties even though they are the same size as each state might have different rates.
For example, here are the rates for some of the states （Quit rent per 100 square meters）：
Melaka - From RM42 in towns to RM8.40 in rural areas
Pahang- From RM50 in towns to RM30 in rural areas
Terengganu - From RM6 in towns to RM1 in rural areas
Is There a Website That Allows Me to Check My Quit Rent?
You can access it on the Pejabat Tanah dan Galian (PTG) or the Land and Mines Office’s official website but the website address differs according to the state.
What Happens if I Do Not Pay My Quit Rent?
A fine will be imposed for late payment of quit rent and you will be given a notice. If you ignore the notice and continue to default, the state can issue a warrant of arrest against you. They can take court action against you and have your land confiscated, as provided by Section 97 and Section 100 of the Land Code. Your property could also be auctioned off by the registrant auctioneer appointed by the municipal council. A 10% cost will be imposed too for payment of the warrant.
What are Property Assessment Rates and Who Has to Pay For it?
Next, assessment rates, also known as Cukai Taksiran or Cukai Pintu, is the local land tax collected by the local councils to pay for developing and maintaining the local infrastructure and services. Examples include:
Erecting and maintaining the street lamps
Cleaning and maintaining the public parks
Collecting municipal rubbish
Construction and maintenance of public infrastructure, etc.
How Much Do I Have To Pay For Assessment Rates?
Assessment rates are calculated based on the estimated annual rental value of your property. Once that figure is assessed, you are charged a set percentage rate of that amount by the relevant local authorities.
So how much might you be charged? The actual amount varies from state to state, but a guideline figure for Malaysia is around 2%-7% of the annual rental value of your property size and the type of property.
Let's say the monthly rental value of that particular commercial property is estimated as RM5,000. Your annual rental estimate would be RM5,000 x 12 for a total value of RM60,000.
Then taking 4% of that (an estimate), and you would owe RM2,400 annually.
Assessment rates are collected over two payments across the year, you would owe RM1,200 per payment (based on the simplified example above).
Property and landowners who have quit rent arrears are also unable to proceed with any transactions involving their asset – including to change the land category, transfer of ownership as well as to lease or mortgage the land.
As long as you own a property, you have to pay the quit rent and assessment tax regardless of whether it is occupied or not.
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