Q.. Is Inheritance from a deceased who died INTESTATE taxable under Malaysian Laws?

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asked on Mar 19, 2023 at 13:47
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edited on Mar 19, 2023 at 14:41
by   jeff005
This article is written in response to recent demise of 2 old friends who died INTESTATE with properties under Civil Laws. One with spouse and children. the other is a bachelor but have siblings. 

Do note that Islamic Faraid Laws of Inheritances is slightly different.

This is my personal derivations from several researched articles found in Malaysian Laws and it is non-legal comments. Please seek proper paid legal services for your issues.

Charts :



Notations :

1. What happens if a will is not written?

When there is no will, then the deceased will be dying 'intestate'. If this happens, the law decides who should deal with the deceased person's money, property and possessions. Only married or civil partners or close relatives can inherit if someone dies intestate.

2.  How to claim assets without will in Malaysia?

The only people who are empowered to do this are the Malaysian courts. So, once a person's death certificate is shown, the court will issue what is known as a letter of administration. Just like a will, this document will list all the assets and property of a person.

3.  Is inheritance taxable in Malaysia?

As there is currently no inheritance tax or capital gains tax in Malaysia, the common types of taxable income for individual taxpayers are income from business or profession, employment, rent, royalties, pensions and annuities.22 Sept 2022

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9 Answers
answered on Mar 19, 2023 at 13:57
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Further notes with respect to bankrupts :

https://www.lawyerment.com/answers/questions/13866/bankruptcy-malaysia-the-impact-of-bankruptcy-on-inheritance-before-and-after
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answered on Mar 19, 2023 at 14:01
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There are laws that govern property that have been left by someone without a will and these can be found in the Distribution Act 1958. It must be noted that this law only applies to non-Muslims in Peninsular Malaysia and Sarawak. So if you don’t come under this category, you will most likely have to follow the intestacy laws of Sabah or Sharia law.
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answered on Mar 19, 2023 at 18:20
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edited Mar 19, 2023 at 18:22
by   jeff005
What happens if a person dies without a will in Malaysia?



1) Your Estates will be frozen until the case is settled. 2) Your surviving family members must appoint an Administrator. This decision needs consent from all family members involved by signing the Renunciation of Administration letter, to be witnessed by the Magistrate / Commissioner for Oaths.
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answered on Mar 19, 2023 at 18:24
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edited Mar 19, 2023 at 19:41
by   jeff005
Can the government take the person’s property?

One may assume that just because there’s no will and so no list of who legally can take the property, the property may go to the government. But the lack of a will doesn’t mean that the property will automatically go to the government. In most cases of a person dying intestate, the property of the deceased will pass on to the family. Obviously, it will start with the immediate family members: The order is:
spouse
children
parents

If the deceased doesn’t have a spouse, children and parents, then the property will pass on to his extended family. While siblings aren’t actually considered to be extended family, they come in fourth in terms of priority. After them, come extended family members such as:
 grandparents
 uncles and aunts
granduncles and grandaunts

...and so on and so forth. 
But in cases where there really are no surviving family members, or no one comes forward to claim the property, the government has the power to legally take the property. Some time ago, an article was released on the statistics of unclaimed assets by families of those who have died intestate. At that point, it was a whopping RM 60 billion. The reason behind this would be extreme cases where the deceased has no family at all. Meaning, none of the above mentioned people are alive or they cannot be traced. So it is only in this instance where the government can take a deceased person’s property.
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answered on Mar 19, 2023 at 18:31
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edited Mar 19, 2023 at 19:43
by   jeff005
Who is next of kin in Malaysia?

Under Malaysian law the next of kin is defined as their married partner or closest living blood relative. They are usually defined in this order: spouse, sibling, friend or employer. If you are not the next of kin, you may need authorisation from that person to register the death or carry out other legal procedures.  2 Nov 2022

What are the intestate rules?

These are called the rules of intestacy. A person who dies without leaving a will is called an intestate person. Only married or civil partners and some other close relatives can inherit under the rules of intestacy.
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answered on Mar 19, 2023 at 18:33
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edited Mar 19, 2023 at 19:44
by   jeff005
Can I write a will without a lawyer in Malaysia?

Technically, you could write a will on your own. You don't need special qualifications to write a legally-binding will. The Malaysian Wills Act 1959 has very simple requirements for a legally binding will, i.e. it must be signed by the testator (you) and two witnesses who cannot be beneficiaries.
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answered on Mar 19, 2023 at 18:35
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What is the law of wills Malaysia?

Section 2 of the Wills Act 1959 defines a will in technical terms as "a declaration intended to have legal effect of the intentions of a testator with respect to his property or other matters which he desires to be carried into effect after his death and includes a testament, a codicil and an appointment by will. 
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answered on Mar 19, 2023 at 18:42
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edited Mar 19, 2023 at 18:49
by   jeff005
Children under 18

Should anything happen to a child under the age of 18-years-old, their next of kin would be the person (or people) who has the legal right to take care of them and make decisions for them.

This person is usually their parent(s), but if there are no parents, the child’s next of kin would be their legal guardian - an individual who has been given legal authority to take care of them and make decisions on their behalf. 

A legal guardian can be appointed in a will document and gives parents the reassurance that their children will be cared for in the event that something should happen to them.
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answered on Mar 19, 2023 at 18:52
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Further information

https://asklegal.my/p/die-without-will-property-family-estate-money
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