Retiring In Malaysia

By Wayne Hor ecentury@tm.net.my

Malaysia is among the most friendly and hospitable places in the far east region to work and live in. Retiring in Malaysia is far cheaper than other developed countries like Hong Kong and Singapore. Malaysia offers a wide range of living style from city living, highland retreats to seaside resorts.  Malaysians are well-known for their warmness and friendliness who easily accept foreigners into their circle of friends.

One of the country's most distinctive features is its rich diversity of cultures, a heritage derived from its racial mix of Chinese, Malay, and Indian. The Malaysians are multilingual and English is widely used in the business communication.

Malaysia also has world-class and well-planned infrastructures that connect all the States in Peninsula Malaysia, modern urban transportation systems that make traveling to the city a breeze, and has among the best medical facilities in Asia. Here are few other reasons why retiring in Malaysia:

• blessed with warm moderate weather all year round.

• superb healthcare facilities and highly-skilled medical practitioners. 

• affordable medical expenses and low insurance rate

• high quality of housing accommodations and variety of choices.

• great education system. It also has many international schools to cater for expats children, and numerous colleges with affiliation with well-known overseas universities.  

• modern shopping centers that have international brand names

• for golf enthusiasts, Malaysia has many championship-level golf courses, and very competitive golf membership rates.

• a majority of the people understand and speak English.

• due to its geographical location, it’s free from natural disaster like earth-quake.

• lots of interesting places to visit, mountains to climb, caves to explore

• a large variety of food, cooked in a lot of different styles that have been influenced by the various cultures that exist in the country

• low crime rate, and highly efficient Royal Malaysian Police

• very friendly people, 

• and the list goes on and on...

The table below gives some indications on the living expenses in Malaysia.

* Based on conversion rate of RM3.6=USD1.00

How to go further?

Malaysia My Second Home Program is open to all foreign citizens wishing to retire or reside in Malaysia on a long term basis. It is fully endorsed by the Government of Malaysia and your immediate family (spouse and children) can also participate in the program. Under this program:

• You will get a 10-year Visit Pass and Multiple-Entry Visa (renewable every ten years) which will eventually give you a lifetime easy access to the country (perpetual visa).

• You can import your car or purchase a new car, tax-free and enjoy other tax incentives.

• You can invest and own businesses in Malaysia. This is like owning a second passport, or a second citizenship in Malaysia. 

• You can enjoy a luxury lifestyle at a fraction of the costs. It is the cheapest and very affordable place to retire early.

• There are many other advantages

In Malaysia there are two options to own a house. First option is to buy new properties “off the plan” from the developer, which means a wait of up to three years before the property is completed. The other option is to buy a new home that is ready for immediate occupancy from existing owner.

Foreign ownership of property in Malaysia is permitted subject to certain conditions laid down in law. The controls on foreign ownership of property are set out in the National Land Code, State rules and guidelines of Foreign Investment Committee (FIC). FIC is a division of the Prime Minister’s Department monitoring the national policies regarding foreign ownership of property through the implementation of its guidelines. The State Authority has the discretion to consider the acquisition based on the area or location of the property, types of property and percentage of the total units in a project.

By law, a foreigner can acquire property valued at more than RM150,000 ( money conversor www.xe.com ) per unit with no limit on the number of property acquired. Financing from internal and external sources are allowed for all acquisition of properties. Acquisition of residential unit under Malaysia My Second Home Program is exempted from obtaining the approval of FIC. Acquisition of commercial property valued at less than RM10 million does not have to incorporate a local company provided that the property is only for own use. Disposal of property by foreigner to foreign interest requires FIC approval. If disposal of property less than RM20 million by foreigner to local interest needs to be informed to FIC.

Acquisition of property involves legal fee, stamp duty, and other statutory charges which amount to about 2%-4% of the purchase price. During the holding period, the property subjects to Assessment Rates payable twice a year and Quit Rent payable once a year. Other costs may comprise of fire insurance, service charges and sinking fund which applicable to strata-titled housing schemes. Upon disposition of property, the costs incurred are Real Property Gain Tax (RPGT) and professional fees like agency fee and legal fee. For foreigners, 30% of the gain is chargeable if the property is disposed within 5 years, and thereafter 5% of the gain will be imposed.

In Kuala Lumpur city, the popular areas suitable for expatriates to accommodate are Kuala Lumpur city center, Ampang / U Thant, Mont Kiara, Petaling Jaya and Damansara where the expatriate community find the public amenities are easy reached. For Semi-Detached houses, the price range is from USD200,000, detached houses are from USD 450,000 and condominiums are in the range of USD100 to USD300 per sq. ft.

Retiring in Malaysia is the right choice which could ease the burden of high living expenses.

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