The Memorandum of Transfer (MOT) is one of the first and last pieces of documents that every house buyer will sign in their ownership of a property, while stamp duty is a tax imposed on documents in the sale or transfer of a property.
The Memorandum of Transfer, or MOT, is a key document that a buyer of a new property (whether strata or individual title) must sign to transfer ownership from the developer (or, in the case of a sub-sale property, from the current owner) to the new owner. It is important to note that the official document is called the Memorandum of Transfer, not the Memorandum of Charge, even though charges are involved.
Typically, if a bank loan is used to finance the property purchase, the MOT is prepared and signed along with the Sale and Purchase Agreement and loan documents. This process saves the buyer from having to make multiple trips to the lawyer’s office to sign the necessary papers. An exception occurs when the property is still under construction; in such cases, the buyer will sign the MOT once the strata or individual title is issued.
What is Stamp Duty? How does stamp duty relate to the MOT?
Many confuse the two, but MOT is not the same as stamp duty! All properties are subject to tax in Malaysia, and the sale and transfer of a property is no different. Stamp duty is the fee to be paid on the Sale and Purchase Agreements (SPA) of your property and for the instruments of transfer (MOT) as well as charge (loan agreements), and falls into two categories:
Ad Valorem: Calculated based on the value of the property or loan agreements
Nominal duties: Chargeable on a fixed duty depending on the type of legal document. Most commonly, legal agreements, copies of policies and agreements