FAQ:LOCALLY MANUFACTURED / ASSEMBLED COMPLETE KNOCKED DOWN (CKD) VEHICLES

Locally manufactured / assembled Complete Knocked Down (CKD) vehicles

  • If I were to purchase my CKD vehicles tax-free, how long must I hold them before I am allowed to sell them off? Will I be paying any taxes when I sell them off?
    Once you have purchased your CKD vehicles tax-free, you must have them in possession for a minimum period of two (2) years before you are allowed to sell them off to a third party.

    The third party will be responsible to pay to the Government any taxes payable on the CKD vehicles based on the tax-written-down value/current market value of the car.
  • I am interested in purchasing the tax-free CKD vehicles I am entitled to. What type of CKD vehicles can I purchase and where can I get them?
    There are many models of CKD vehicles in the Malaysian market, not limited to Proton and Perodua.

    Successful REP recipients may enquire for the list of locally assembled/manufactured CKD vehicles currently sold in the Malaysian market from the Secretariat, Malaysian Automobile Association (MAA) at their website.
  • How does it work?
    To purchase CKD vehicles under the REP, returnees will have to approach a car dealer with a copy of their Surat Akuan Tarikh Kembali and Approval Letter.

    Returnees will have to inform the car dealer on the intention to make a purchase under the REP.

    The dealer will then be able to place an order for a locally assembled / manufactured CKD of choice from a local factory and apply on behalf of returnees for tax exemption through manual application.

    Returnees may then proceed to claim their car from the dealer.
  • If I want to register the car under my spouse's name, is it acceptable under this programme?
    Currently the car can be registered under the recipient's name/spouse/children. This is stated in the tax exemption approval letter from Ministry of Finance.

    However, this may be subject to changes, as such REP recipients should be aware of the content of the tax exemption approval letter should there be an changes.
  • Am I eligible to purchase second hand vehicles or I'm only entitled for the brand new vehicles?
    Vehicle must be purchased brand new as it has not been paid its excise duty and sales tax or not yet been manufactured where the dealer have to place an order from the local factory. As such, it is advisable for recipient to purchase a brand new vehicle.
  • Is the tax-free exemption for locally manufactured / assembled CKDs the same as the Malaysia My Second Home (MM2H) scheme's incentives?
    Though the incentives for REP and MM2H differ, the process of purchasing a tax-free CKD under the REP is almost like the process of getting a car under the MM2H scheme.
  • Do you have some information which highlights the pre/post tax prices of vehicles?
    Recipients may refer to the Customs Department for the exact pre/post tax prices. TalentCorp do not have any access to this info due to its confidentiality.

    However, recipients may refer to this site for an idea on examples of tax deduction. Prices will differ depending on the make, model, engine capacity and also the profit made by the dealer.
  • How much is the price for CKD after deduction?
    Refer to the previous question.
  • What is the reducing scale like? Is the tax to be paid back on a reducing scale since the market value of the car will be reduced? What is the minimum number of years before the taxes will be reduced to zero?
    Recipients will have to refer to Customs for the computation of taxes as TalentCorp does not have any access to this information.
  • I bought a CKD car a few months ago and wish to sell it; as such do I need to pay back all related taxes?
    Approval of excise duty and sales tax will be withdrawn if recipient violates any of the conditions contained in the approval letter from TalentCorp. Applicants will then have to pay duties and taxes as per normal.
  • The first CKD car that I purchased was in January 2012. Can I sell it? Is there any requirement that says I must use the car for a specific time period before being able to sell it?
    Once recipients have purchased their CKD vehicles tax-free, they must possess it for a minimum period of two (2) years before it can be sold off to a third party. Recipients will have to pay duties and taxes, if the conditions of the tax exemption have been violated.
  • If I use my car for more than 2 years, I can sell it after that and will not have to pay any taxes. If this is the case, will the buyer have to pay the taxes? Is it true that no tax and duty will be imposed if the car is more than 5 years old?
    Once you have purchased your tax deducted CKD vehicle, you must have them in possession for a minimum period of two (2) years before you are allowed to sell them off to a third party.

    The third party will be responsible to pay to the Government any taxes payable incurred on the CKD vehicle based on tax-written-down-value / market value.

    Vehicles cannot be sold or its ownership transferred (penukaran hak milik) without paying excise duty and sales tax calculated by the Royal Malaysian Customs during the sale or ownership transfer. There will be taxes paid at any time the car is sold.
  • For a married couple, how many CKD cars are allowed under the REP?
    Applications would have to be submitted individually and if approved, each applicant is eligible for one car.