Brunei – Property Taxes

What taxes and fees apply when buying a property in Brunei?

Brunei imposes no property transfer taxes. This immediately distinguishes it from many other jurisdictions — Canada, for instance, charges a provincial land transfer tax of 0.5%–2.5%, while the UK applies Stamp Duty Land Tax on a tiered basis — meaning Brunei has no direct counterpart to the conventional “property transfer tax” seen elsewhere.

Stamp duties are charged on instruments listed in Schedule 1 of the Stamp Act, Chapter 34, at either ad valorem or fixed rates. The duty is payable on the transfer of property, with the applicable rate depending on the nature of the asset involved. A comprehensive government schedule of rates for residential property transfers is not publicly available in a single consolidated document — buyers should confirm current rates directly with the Revenue Division of the Ministry of Finance and Economy (MOFE) before finalising any transaction.

Beyond stamp duty on the transfer instrument, buyers who use financing will also incur stamp duty on the mortgage or loan agreement, along with solicitor fees for conveyancing services. Brunei has no VAT or sales tax, so those costs do not feature in property transactions. For foreign investors, total transaction costs typically fall within a range of 3–5% of the purchase price.

A worked example helps illustrate the typical cost structure. Consider a buyer acquiring a leasehold condominium unit in Bandar Seri Begawan for BND 350,000. Expected costs would include stamp duty on the transfer document (variable — confirm with MOFE), stamp duty on any mortgage instrument, solicitor and legal fees (generally 0.5%–1% of the property value, to be negotiated with your lawyer), and land registration or title fees. Based on publicly available guidance, total transaction costs for this kind of purchase — covering legal fees, stamp duty, and registration — would likely fall somewhere between BND 10,500 and BND 17,500 (3–5%). Always request a full fee breakdown from your chosen solicitor before exchange. All figures should be verified against current official sources, as rates are subject to change.

An important procedural point: every property transfer in Brunei requires approval from “His Majesty in Council,” a council of officials acting on behalf of the Sultan. This process can be time-consuming and introduces an added layer of complexity to property transactions. Buyers should plan their timelines accordingly and not assume a rapid completion.

What taxes and fees apply when selling a property in Brunei?

Brunei does not impose transfer taxes on property sales. This means there is no capital transfer levy falling on the seller, which contrasts with jurisdictions such as Australia where the vendor may face costs linked to capital gains tax obligations (discussed in the next section). A seller’s costs in Brunei are therefore essentially confined to agent commissions and legal fees.

Real estate agency commission in Brunei is not set by statute and is typically a matter of negotiation between the seller and their chosen agent, usually settling somewhere in the 2–3% range relative to the sale price. Sellers are advised to confirm commission terms in writing before formally engaging an agent. Solicitor fees for the seller’s legal representative will also arise, primarily in connection with drafting and executing the sale and purchase agreement.

There is no “seller’s stamp duty” of the kind levied in Singapore — where property sold within a short window can attract a charge of up to 12% — nor is there any capital gains withholding requirement on the seller at the point of sale. The vendor’s cost burden in Brunei is therefore modest, making it a comparatively simple environment for sellers. As always, consult MOFE or a locally qualified lawyer for up-to-date figures before proceeding with any transaction.

Is capital gains tax payable on property sales in Brunei?

Brunei Darussalam levies no capital gains tax. This applies uniformly to residents and non-residents, and to both individual and corporate property owners. Australia’s CGT regime taxes 50% of gains on assets held for more than 12 months, and the US federal system imposes capital gains tax on property disposals — Brunei has no equivalent mechanism for taxing property appreciation.

There is, however, one important qualification. Where the relevant tax authority can establish that gains form part of a business’s ordinary trading activities, those gains become taxable as revenue rather than capital. In practical terms, an individual or company whose core commercial activity involves buying and selling properties may find that profits from such transactions are treated as standard business income and assessed under Brunei’s corporate income tax framework, rather than as a capital gain exempt from tax.

Income arising from capital gains — including the sale of property or investments — is generally not subject to tax in Brunei. For the great majority of private buyers and investors who acquire property for personal use or long-term holding purposes, there is no tax liability on the profit realised at the point of sale, regardless of how long the property has been owned or how substantial the gain may be.

By way of illustration: if you purchase a condominium unit for BND 300,000 and sell it five years later for BND 420,000, the BND 120,000 gain is not subject to any tax in Brunei. However, if you are a property developer or if the pattern of your buying and selling activity leads the tax authority to conclude that you are engaged in a trade, that BND 120,000 could instead be assessed as taxable business income under the corporate tax rules. If you are transacting across multiple properties, confirm your position with the Revenue Division of MOFE or a qualified tax adviser.

It is also worth noting that your country of residence or citizenship may still impose tax on gains arising from property held overseas. Although Brunei’s tax environment is advantageous, foreign investors must not overlook the tax implications that exist in their own home jurisdictions. Always seek advice where you are tax resident before disposing of property.

Are there annual property taxes in Brunei?

In contrast to most countries around the world, Brunei does not levy annual property taxes on residential properties, which substantially reduces holding costs for owners. This represents a meaningful advantage for owner-occupiers and residential investment landlords alike. By comparison, France charges the taxe foncière, Spain levies the IBI, and the United States imposes local property taxes — each representing a recurring annual cost that simply does not exist for residential property holders in Brunei.

Commercial properties, however, are subject to a property tax based on the estimated value of the property, with the quantum determined by the relevant local municipal board. If you hold a commercial property — such as a shophouse, office unit, or retail premises — you will be liable for this municipal levy. Owners of commercial property should contact the appropriate municipal board in their district to obtain the current assessed rate and understand their payment obligations. Verify current figures with the Ministry of Finance and Economy or the relevant local authority.

There are no net wealth or worth taxes applicable to property holdings in Brunei. Owning substantial property assets does not give rise to any annual wealth-based charge, which compares favourably with countries such as Norway or Switzerland where wealth taxes can extend to real estate holdings.

How is rental income from property taxed in Brunei?

One of the most striking features of Brunei’s tax system is the complete absence of personal income tax for individuals — a policy that extends equally to rental income. This makes real estate investment particularly appealing for those looking to generate passive income streams. Individual landlords in Brunei — whether resident or non-resident — pay no personal income tax on rental receipts from Brunei-situated property.

This positions Brunei favourably against the majority of other countries. In the UK, rental income is subject to income tax at marginal rates reaching up to 45%; in Australia, net rental income is included in an individual’s assessable income and taxed at rates up to 47%. In Brunei, an individual landlord’s rental receipts are entirely free from personal income tax at the local level.

The picture changes if property is held through a company rather than in an individual’s own name. In that scenario, Brunei’s corporate tax rate of 18.5% applies to net rental profits. Corporate landlords must file annual returns with the Revenue Division of MOFE and settle corporate tax on net rental income after permissible deductions. Allowable expenses for companies generally include costs wholly and exclusively incurred in generating the rental income — such as repairs, maintenance, and property management charges.

Brunei’s tax rules do not draw a specific regulatory distinction between short-term letting arrangements (such as those facilitated through platforms like Airbnb) and conventional long-term residential tenancies. Since individual landlords owe no personal income tax on rental income in Brunei regardless of the letting model adopted, this distinction has limited immediate tax significance at the local level. Nevertheless, operators of short-term rentals should be mindful of any local licensing or tourism-related regulations that may apply and should verify compliance requirements with the relevant regulatory body.

Landlords from other countries who receive rental income from Brunei property may still be obliged to declare that income to their own domestic tax authority. Brunei’s favourable tax environment does not neutralise tax obligations that arise in a foreign investor’s home country — those subject to worldwide income taxation must report Brunei rental income on their domestic tax returns and should seek appropriate professional advice.

Does inheritance tax apply to property in Brunei?

Brunei imposes no inheritance, estate, or gift taxes. Estate duties were formally abolished with effect from 1 January 2013, meaning that property passing on death carries no estate duty or inheritance levy in Brunei, whatever the value of the estate. This compares very favourably with countries such as the UK — where inheritance tax applies at 40% above the nil-rate band — or the United States federal estate tax system.

While no tax liability arises on inherited property, non-citizen heirs face significant structural constraints under Brunei’s updated land laws. Foreigners are not permitted to retain freehold land indefinitely. A non-citizen who inherits freehold land must declare that interest within 12 months; the freehold title must then be sold to a Brunei citizen within 10 years, failing which the title will be converted to leasehold.

If a foreigner inherits freehold property, they must declare it within 12 months and sell it to a Brunei citizen within 10 years; otherwise the title is converted to leasehold. Where leasehold property is inherited, the inheritance continues only for the duration of the remaining lease term. These requirements stem from the Land Code (Amendment) Order 2025 and apply irrespective of the tax treatment of the inheritance. Non-citizen heirs should take immediate legal advice upon inheriting property situated in Brunei.

Brunei has not concluded a wide network of double taxation treaties covering inheritance or estate tax with other countries, largely because it abolished estate duty in 2013 and has no equivalent charge in place. However, the deceased’s home country may impose inheritance or estate tax on worldwide assets — potentially including Brunei property — so heirs should take professional advice in the applicable jurisdiction. For matters relating to property held in a deceased’s estate, consult a solicitor registered with the Attorney General’s Chambers of Brunei Darussalam.

Does gift tax apply to property transfers in Brunei?

No gift tax exists in Brunei. Transferring property as a gift during the lifetime of the donor — whether between family members or to any other recipient — does not attract any gift-specific tax liability in Brunei. Stamp duty on the transfer instrument will still be payable in the usual way, as it applies to any document effecting a change in property ownership, but there is no supplementary gift levy on top of this.

The UK presents a stark contrast: gifts of property there can trigger Stamp Duty Land Tax and potentially inheritance tax if the donor passes away within seven years of making the gift. The US gift tax system applies to transfers exceeding annual exclusion thresholds. Brunei imposes no equivalent charge on property gifted during a person’s lifetime. The principal cost of gifting property in Brunei is therefore stamp duty on the transfer document, together with solicitor fees for the conveyancing work involved.

That said, the land ownership restrictions outlined elsewhere in this article extend equally to gifts. Brunei citizens are prohibited from holding property on behalf of foreigners or permanent residents, and any such nominee or trust arrangement is declared void under the current law. A gift of freehold land to a non-citizen triggers the same obligation to declare and sell within ten years that applies to inherited freehold property. Anyone considering gifting property to a recipient who does not hold Brunei citizenship should consult a locally qualified solicitor before proceeding.

Are there any tax advantages or incentives for buying property in Brunei?

Brunei’s property tax framework is itself a compelling structural incentive. The combination of no capital gains tax, no personal income tax on rental receipts, no recurring annual residential property tax, no inheritance levy, and no gift tax means that the overall fiscal cost of owning and investing in Brunei real estate is exceptionally low by international standards. The overall tax burden in Brunei is comparatively light, as the government draws heavily on revenue from the oil and gas sector to finance public services and infrastructure, reducing the need for broad-based taxation on individuals and businesses.

Another distinctive feature of Brunei’s real estate market is the degree of government involvement in housing. The government operates large-scale housing programmes through the Housing Development Department (Jabatan Kemajuan Perumahan) under the Ministry of Development, aimed at ensuring citizens have access to affordable homeownership. These schemes are, however, primarily designed for Brunei citizens and are generally not accessible to foreign buyers or expatriates.

The Brunei government has actively sought to attract overseas investment, particularly in sectors that support broader economic diversification. Various incentives have been put in place for foreign investors, including potential tax reliefs and streamlined registration procedures. Foreign nationals should consult local legal experts to identify the specific programmes currently available, as these can materially improve the prospective return on an investment.

For corporate or commercial property investors, Brunei also makes available pioneer status and investment incentives under the Investment Incentives Order for qualifying businesses. Property held through a Brunei-incorporated company is subject to corporate tax at 18.5%, and newly established companies may be eligible for exemptions on the first BND 100,000 of chargeable income during their first three years of assessment. Always confirm the latest incentive programmes with the Ministry of Finance and Economy and the Brunei Economic Development Board (BEDB).

Do different rules apply to foreign buyers or non-residents purchasing property in Brunei?

Yes — and this is a critical area for any prospective expat buyer. While the tax treatment of property is broadly the same for foreigners and citizens alike (no CGT, no annual residential property tax, no inheritance tax), the structural ownership restrictions are substantial and have been further tightened under the Land Code (Amendment) Order 2025, which entered into force on 1 August 2025.

Foreign nationals are generally barred from owning land in Brunei. The Land Code of 1909, which continues to underpin property law in the country, reserves freehold land ownership primarily for Brunei citizens. Foreigners cannot own freehold land and may only hold interests in land through lease, sub-lease, or charge.

Since 2015, foreign nationals have been permitted to own strata title properties — chiefly apartments and condominiums — under the Land Strata Act for terms of up to 99 years, without needing a power of attorney arrangement. This is the principal avenue available to foreign buyers in Brunei’s residential market. Foreigners can purchase apartments and condominiums in Brunei, but not land or standalone houses. This restriction is designed to preserve the national land heritage while still encouraging foreign participation in the real estate sector.

In 2012, the government introduced legislation that effectively prohibited foreigners from using powers of attorney or trust deeds to acquire property — mechanisms that had previously been widely used by non-citizens to indirectly hold property interests. The 2025 Land Code amendment reinforces this prohibition and explicitly voids nominee ownership arrangements, whereby citizens hold land on behalf of non-citizens or stateless residents.

Foreign investors with proxy ownership must declare their interests at the Land Office by 1 August 2026. If you have previously purchased property through a nominee or trust arrangement, this deadline is of critical importance and you should seek professional legal advice without delay.

The step-by-step process for a foreign buyer purchasing a leasehold strata title property in Brunei is as follows:

1. Property search: Identify suitable strata title properties (apartments or condominiums) through a licensed estate agent or online portals. Confirm that the property type is eligible for foreign ownership.
2. Engage a solicitor: Appoint a lawyer registered with the Attorney General’s Chambers of Brunei to advise on the transaction and conduct due diligence, including a title search and review of the lease terms.
3. Sales and purchase agreement: The solicitor drafts and reviews the formal sale and purchase agreement between buyer and seller. Both parties sign once terms are agreed.
4. Due diligence: The solicitor conducts verification of title, confirms the remaining lease period, checks for any charges or encumbrances on the property, and verifies compliance with current land regulations.
5. His Majesty in Council approval: A distinctive feature of Brunei’s conveyancing process is the requirement to obtain approval from “His Majesty in Council” — a council of officials who review and approve property transfers on behalf of the Sultan. The timeline for this approval is not fixed and can run to several months; this should be built into your investment planning from the outset.
6. Stamp duty: Once approval is granted, the transfer instruments must be stamped in accordance with the Stamp Act, Chapter 34. Your solicitor will manage the adjudication and payment of stamp duty to the Revenue Division of MOFE.
7. Registration: The property title is registered at the Land Office in your name (or in the name of your corporate vehicle if purchasing through a company). Registration fees apply — confirm current amounts with the Land Office.
8. Completion: Full payment of the purchase price is made, keys are handed over, and you receive the registered title document confirming your leasehold interest.

Brunei does not impose any additional stamp duty surcharge on foreign buyers — unlike Singapore, which levies an Additional Buyer’s Stamp Duty (ABSD) of up to 60% on foreigners purchasing property. However, the ownership restrictions themselves significantly narrow the range of property types available to non-citizens. Engaging a solicitor with specific expertise in foreign property transactions in Brunei is essential to navigating this process successfully.

Frequently asked questions: property taxes in Brunei

Do I pay any tax when I buy property in Brunei as a foreigner?

There is no property transfer tax or stamp duty surcharge that applies specifically to foreign buyers in Brunei (as of 2025). Stamp duty under the Stamp Act, Chapter 34 is charged on the transfer instrument at an ad valorem rate, and legal and registration fees will also be payable. The applicable stamp duty rate varies depending on the transaction type — confirm current figures with the Revenue Division of the Ministry of Finance and Economy before proceeding.

Is there capital gains tax if I sell my Brunei property at a profit?

No. Brunei levies no capital gains tax. Any profit realised on the sale of a residential or investment property is not subject to tax in Brunei, regardless of the holding period or the size of the gain. The sole exception arises where the tax authority determines that your property activity amounts to a trading business, in which case profits may be assessed as corporate income. Always confirm your position with a qualified tax adviser, and bear in mind that your home country may tax gains on property held abroad.

Do I pay annual property tax on a home I own in Brunei?

No annual property tax is levied on residential properties in Brunei. Commercial properties are subject to a municipal property tax calculated on the estimated value of the property, with the rate set by the relevant local municipal board. If your property is purely residential — a home or condominium unit — there is no recurring annual levy to pay in Brunei.

Is rental income from my Brunei property taxable?

If you hold property in your own name as an individual, rental income is not subject to personal income tax in Brunei, since Brunei does not impose personal income tax at all. If you hold property through a company, net rental profits are subject to Brunei’s corporate income tax at 18.5%. Bear in mind that your home country may still require you to declare and pay tax on rental income earned abroad — seek advice from a tax professional in your country of residence.

Will my heirs pay inheritance tax on Brunei property?

No inheritance or estate duty is payable in Brunei following the abolition of estate duties on 1 January 2013. However, non-citizen heirs who inherit freehold land must declare the inheritance within 12 months and transfer the freehold title to a Brunei citizen within 10 years — failing which it will be converted to leasehold. This obligation flows from the Land Code (Amendment) Order 2025 and is a structural legal requirement rather than a tax. Non-citizens who have inherited Brunei property should seek immediate advice from a locally qualified solicitor.

Can I buy a house or piece of land in Brunei as a non-citizen?

In most cases, no. Foreign nationals are generally prohibited from owning freehold land or landed residential properties such as houses, villas, or bungalows in Brunei. The primary option open to foreign buyers is strata title leasehold property — apartments and condominiums — held for terms of up to 99 years under the Land Strata Act. Ownership of freehold land by foreigners is possible only with the direct approval of the Sultan, which is granted very rarely. Confirm the current position with a qualified Brunei solicitor before proceeding.

Are there any gifting taxes if I transfer property to a family member?

Brunei has no gift tax. Transferring property by way of gift does not trigger any gift-specific levy. Stamp duty on the transfer document will still apply in the usual manner, and where the recipient is a non-citizen, the freehold ownership restrictions described in this article will come into play. Obtain legal advice before gifting property to ensure full compliance with the current land ownership rules.

Where can I get official information on property taxes and fees in Brunei?

The principal official source for tax-related information is the Revenue Division of the Ministry of Finance and Economy (MOFE). For matters relating to land and property registration, contact the Land Office under the Ministry of Development. For investment incentives, consult the Brunei Economic Development Board (BEDB). Always engage a locally qualified solicitor for advice specific to your transaction, as property law in Brunei is subject to change — most recently through the Land Code (Amendment) Order 2025.