When someone passes away in Malaysia, his or her property is administered under either the Grant of Probate or Letters of Administrations. The administration of the estate follows two distinct paths depending on whether the deceased has left a will or not. In both of these cases, the estate will be frozen until Grant of Probate or Letters of Administration is obtained.

If the will exists, it will appoint the executors, responsible for the distribution of the estate. The executors shall apply for a Grant of Probate to High Courts in Malaysia, which would release the estate and authorize the executors to pay off debts, sell or transfer property and distribute the assets to the beneficiaries. In this case, no distribution order, guarantors or sureties are required.

If there is no will, a family member or any person interested in the deceased estate, for example, a creditor, can apply for Grant of the Letters of Administration. The procedure for the extraction of the Letters of Administration in Malaysia depends on the type and the value of the estate. For estates exceeding RM600,000, guarantors or sureties are required to guarantee proper distribution of the estate by the administrator(s).

Since the application for Grant of Probate or Letters of Administration in Malaysia may be complicated due to formalities or when the estate becomes contested by heirs and beneficiaries, it is recommended to involve a lawyer. A lawyer would help to channel the process in a most expedient way, assist with preparing the documents and filling in the forms as well as will stand by you in case of any disputes.

A Grant of Probate is a document, issued by the High Courts, which appoints an executor (or up to 4 of them if acting jointly) to manage and distribute the estate. This can be one of the most straightforward ways to get access to the diseased property with a minimum time required. Should the executor withdraw or be unable or incapacitated to manage the estate, the Court would grant a Letter of Administration with a Will Annexed, appointing administrators to the estate under the provisions of the Probate and Administration Act 1959.

Transaction of immovable properties (land, houses) from an estate requires a two-step process, regardless of the existence of a Will. First, the property will be vested on the executor/administrator by way of transmission. Once the beneficiary to the particular property is ascertained, the executor will transfer the property to the respective beneficiary.

Transfer of property is the transfer made to a named beneficiary, regardless of whether the estate is testate (with Will) or intestate (without Will). This is, however, not the case if the property is to be transferred to a third party.

Under the Will, there are 3 immovable property gifts to beneficiaries by the deceased. In the end, beneficiaries decided to keep just 1 property and sub-sale 2 other properties.

Therefore, the beneficiaries need apply service for;
1x Grant of Probate
3x Transmission of property
1x Transfer of property

If there is no immovable property, the beneficiaries only need to apply service for the Grant of probate.

In case the deceased has died intestate, which means that he or she has left no will, the distribution of the estate is entrusted to administrators. In Malaysia, any person who may have an interest in the estate, such as next of kin or a creditor, may file for Grant of Letters of Administration. The process of extracting the Letters of Administration depends on the value of the estate and the presence of immovable property/real estate in the composition of the assets.

Transaction of immovable properties (land, houses) from an estate requires a two-step process, regardless of the existence of a Will. First, the property will be vested on the executor/administrator by way of transmission. Once the beneficiary to the particular property is ascertained, the administrator will transfer the property to the respective beneficiary.

When there is no Will, then the administrator will have to obtain a Distribution Order from the high court to ascertain the beneficiaries when involved in the transfer of property.

Transfer of property is the transfer made to a named beneficiary, regardless of whether the estate is testate (with Will) or intestate (without Will). This is, however, not the case if the property is to be transferred to a third party.

Without the Will, there are 3 immovable property gifts to beneficiaries by the deceased. In the end, beneficiaries decided to keep just 1 property and sub-sale 2 other properties.

Therefore, the beneficiaries need apply service for;
1x Grant of Letters of Administration
3x Transmission of property
1x Distribution Order
1x Transfer of property

If there is no immovable property, the beneficiaries only need to apply service for the Grant of Letters of Administration.

All transfer of immovable property is subjected to ad valorem stamp duties. Some cases would be exempted from ad-voleram stamp duties and replaced by nominal stamp duties. Like transfer by law, under Will (Wills Act 1959) and without Will (Distribution Act)

From 1st July 2019 onwards, the calculation of the ad-valorem stamp duty of transfer is as follows:-

For example, the market value of a property worth RM500,000 would put you in the first two tiers, hence, 1% of RM100,000 and 2% of RM400,000.

1% of RM100,000 = RM1,000
2% of RM400,000 = RM8,000
Total stamp duty fees: RM9,000

Without one, how much are they gonna spend?

• For Probate, the testator appointed the Executor.
• For Letters of Administration, the court needs to appoint an Administrator. This means, more legal fees and processing fees.

• For Probate, the testator decides beneficiary, pay nominal stamp duties for transfer in accordance to Will.
• For Letter of Administration, transfer would be in accordance with Distribution Act. However, if the beneficiaries decide the transfer otherwise, then ad-valorem stamp duties apply (for shares transfer not in accordance to Distribution Act). This means, need to pay more stamp duties.

• For Probate, the processing time is short (within 6 months) because the executor is appointed.
• For Letters of Administration, the processing time is long because the court needs to appoint an administrator and more processes. The whole process may take up to 2 years, or even longer during MCO!

Example:

There is a family of 3 members, Mr.X, his mother, and his wife.
Mr. X passed away and wanted to leave the house(market value RM500000) to his wife.

1. Under the will - Husband transfer to the wife
The estates will be distributed to the beneficiaries according to the wishes of Mr. X.
This means she needs to pay the application of Grant of Probate + Transmission of Property + Transfer of Property.

Total = RM5000 + RM500 + RM2000 = RM7500
The whole process takes up to 6 months

2. Under the Letters of Administration - Husband transfer to wife without will
Mr. X has died intestate and his estate will be distributed according to a designated formula in the Distribution Act 1958. This means, 1/2 share will transfer to his wife, and 1/2 share transfer to his mother.
This means she needs to pay the application of Letters of Administration + Transmission of Property + Distribution Order + Transfer of Property + Ad-valorem stamp duties (1/2 share).

Total = RM6500 + RM500 + RM2000 + RM2000 + RM4000 = RM15000
The whole process takes up to 2 years

Without a will, Mr.X's wife needs to pay an extra RM7500 to get the total share, and the time for processing is much longer.