How do I finance my land investment?
Most banks provide for a loan amount of 50-70%. Again it depends on the type of land and what is its intended purpose as well as the buyer’s profile. Banks award financing based on the potential profitability the land would generate. Say your (residential use) land is located nearby a condominium project which recently saw a good take-up rate; then you can expect to get a 70% financing.
Investors should look towards commercial banks such as Maybank, CIMB and UOB for the financing of development land whereas loan application for agricultural land meant for plantation endeavours and such would only fly with an Agro Bank.
Is land subject to taxes such as the Goods & Services Tax (GST)?
As per the Royal Malaysian Customs GST Guide, the sale, lease or rent of land other than land for residential, agricultural or general use (public amenities, parks, etc) is subjected to 6% GST.
However, there are few other instances where GST comes into play. In cases of JV between developers and land owners to build commercial/ industrial properties, the land owners will have to pay GST for any consideration (money or real estate units) they receive in kind even though there was no land transaction. It will be best to always consult your accountant or tax planner to avoid any ‘shocks’ down the road.