[Myanmar] New Tax Clearance Requirement for Property Sellers Takes Effect on 1 September 2026

Theo Millet, Hnin Thiri Aung & Hla Myet Thwe

Property sellers in Myanmar should prepare for an additional tax compliance step on any transfer of property from 1 September 2026. The Internal Revenue Department (“IRD”) has announced new procedures requiring sellers to address their capital gains tax position and obtain the relevant tax clearance certificate as part of the transfer process.

The requirement is particularly important for transactions involving land, houses, condominium units and other properties where completion of the transfer requires registration or a formal change of ownership with the relevant government authority.

What Will Change from 1 September 2026?

Under the announced procedure, the property is first assessed by the relevant Assessor’s Department and the purchaser proceeds with verification of the source of funds at the relevant township tax office. The seller must then obtain the determination from the tax authorities as to whether a capital gain has arisen from the disposal.

Where tax is payable, the seller shall comply with the applicable capital gains tax requirements and obtain the relevant tax clearance certificate. The new procedure therefore brings the seller’s tax compliance more directly into the formal property transfer process. The purchaser also has the separate obligation. Before the transfer can be completed, the purchaser must satisfy the relevant township tax office as to the source of the funds used for the purchase. Thus, the purchaser should therefore need to assemble evidence of the origin of the purchase monies at an early stage. In the event where the source of funds cannot be evidenced by any document, the IRD will levy the income tax on the purchase monies as an income that has escaped the assessment under the existing Union Tax Law.

Where the aggregate value of capital assets disposed of during a financial year exceeds MMK 10 million and a taxable capital gain arises, the seller shall file the relevant income tax return and pay the applicable tax within 30 days from the date of transfer. Transfers by way of succession, gifts made without consideration and donations are excluded from the capital gains tax charge.

For houses, land, buildings and apartments, the disposal value is based on the value assessed by the relevant Assessor’s Department. In determining the taxable gain, the seller may generally deduct the original acquisition value and allowable expenses, including improvement costs, brokerage fees and other ordinary transaction expenses, in determining the taxable capital gain. The resulting gain is generally taxed at 10%.

Does the Requirement Apply to Apartments Sold Only by Private Contract?

This is likely to be one of the most significant practical questions arising from the announcement. A substantial number of apartments in Myanmar are bought and sold through private sale and purchase agreements rather than through a formal registered ownership transfer. In some cases, successive purchasers hold only contractual documents, and the relevant instruments may not have been duly stamped. The official underlying ownership may remain recorded in the name of the landowner and/or the contractor that constructed the building. Where an instrument was never duly stamped, there is a stamp duty exposure and potentially a penalty, which is sitting alongside the capital gain question.

For these apartments, there may therefore be no separate government ownership record for the individual unit that must be changed each time it is sold. Consequently, unlike a land transfer or transfer of a registrable condominium unit, there may be no formal ownership-transfer stage at which the authorities can require the seller to produce tax clearance before the transaction proceeds.

Accordingly, the immediate practical impact on this segment of the apartment market may be more limited as there is no registration checkpoint at which the clearance can be required. That is a gap in the enforcement mechanism rather than in the tax levy itself.

However, this is not an exemption from capital gains tax. A seller who realizes a gain remains liable to tax whether or not the transaction is conducted privately and no formal ownership name change takes place. The practical issue is instead whether and how compliance can be verified and enforced in the absence of a government registration process.

Which Transactions Are Most Likely to Be Affected?

The new procedure is expected to have the clearest immediate impact on land and landed houses, registrable condominium units, apartments owned or administered by the Department of Urban and Housing Development (DUHD), and other properties for which the transfer requires formal registration or a change in the registered owner's name. For these transactions, the authorities have a clear administrative point at which tax compliance can be checked before the transfer is completed.

The procedure may also affect property trading activity. Property traders have sometimes acquired and resold properties, particularly apartments without settling capital gains tax before the subsequent resale. Where a formal registration or ownership change is required, the new tax clearance procedure is likely to make such practices considerably more difficult.

When Does the New Requirement Start?

The new procedure takes effect on 1 September 2026. It is therefore not immediately effective as of the date of the IRD's announcement; the stated commencement date provides a short period before implementation.

Sellers contemplating transactions on or after 1 September 2026 should review their acquisition documents and supporting records for deductible expenditure before proceeding with a transfer. Particular attention should be paid to the property's ownership structure and whether the proposed transfer requires registration or an official change of ownership, as these factors are likely to determine the practical significance of the new tax clearance procedure.