MM2H / Malaysian Retirement Questions

[Taikoowan]

There are some old posts on moving to Malaysia on MM2H visa, but recent changes in MM2H and Covid related restrictions make it necessary to write & reopen this discussion.

I am seeking your views on -
1. Pros/Cons on moving to Malaysia from Hong Kong as a retired person.
2. Ideal location in Malaysia - Penang, or KL?
3. How does one take a pet dog to Malaysia, I believe most condo type estates don't allow dogs, at least the larger breeds and I have a Labrador.

Many thanks

[Hkemail888]

Pros:
cost of living
nice people
nice food
easy to get along only with english

Cons:
crime rate / security not top
healthcare not top

many others pros and cons though

[shri]

I think @Cwbguy moved to Penang with a larger dog..

[shri]

Cons:
crime rate / security not top
healthcare not top

many others pros and cons though

Questions:

- How does crime rate affect you in KL, say in the major areas like Mont Kiara / Bangsar etc? Is it petty theft / muggings or major crime / drugs etc? Also how does it affect you if you're in a landed property v/s an apartment complex (for break-ins)

- How are major hospitals like Gleneagles etc in KL / Penang compared to say their singaporean or HK counter parts? How does it work with GP visits (given that most people tend to use hospitals for emegencies / major care?

If you factor in cost of living differences between HK and almost anywhere in KL - i.e. you're saving on rent etc, how does the infrequent cost of say top end medical care in KL or Penang factor into your expenses?

I'm on the opinion that the whole "free medical care" in HK thing is BS for many who are in the middle / upper middle income groups .. given that we spend so much on the land tax - high rents, cost of buying and related costs passed through retail - which over decades amounts to a significant amount. Also as a tax payer and PR I would not have a problem coming to HK every few months to queue up at the HA for my free suitcase of meds.

My opinion might be different if I had chronic and deadly issues which might be too expensive or exotic for the Malaysian system...

Adding to what the OP has asked - what are the costs of insurance for a relatively healthy expat in either KL or Penang?

[shri]

@Windmill65 - Thanks in advance for any inputs you may have..

[Windmill65]

@Windmill65 - Thanks in advance for any inputs you may have..

Thank you for considering my opinion about this topic as relevant.

To start of with the MM2H program: it was halted about 1.5 years ago. My impression is that it was almost scrapped due to politics. But they decided to not scrap it completely, and instead overhaul it. It will therefore be restarted some day in the future. At the moment does it have a very low priority and there is no visible progress. It is 99% sure though that the rules and requirements for obtaining MM2H will become different to what it was previously.

Living in KL versus Penang is an endlessly ongoing discussion. It depends on what lifestyle you prefer as the two are rather different. I don't like KL at all and prefer Penang. Others would look at me and wonder how I could do without a "big city" environment.

About pets, especially dogs: it depends on the management of the condo building whether pets are allowed. And, in case you rent a unit, it depends on the owner of the unit. I see a couple every morning walking their two Golden Retriever dogs; they live in a condo nearby. Whereas the condo where I live has a "no pets" policy.

I see "easy to get along with English only" being mentioned. That might be the case in Penang and KL, but elsewhere in the country is that not always the case. And, the older generation is more fluent in English than the younger generation. The education system has shifted its priorities since Malaysia became independent.

"Crime rate/ security" depends a lot on where you live. The more upscale condo buildings have a front gate with guard men, locked front doors which only open with a card key and a lift which only works if you have a card key. Your front door is then locked with a regular key. If you decide to live in an environment where these measures are not in place then it becomes easier for others to enter your unit.

The quality of healthcare is very good, but there is a difference between government hospitals and private hospitals. Luckily I'm healthy and didn't have to use these facilities myself. So all I know is from hearsay. Many doctors (GPs, or hospital doctors) are trained in the UK or Australia. Dentists are also good, in my limited experience. Most times when I had to visit a GP or dentist it cost me about RM100 (USD25, consult plus prescriptions), which I paid out of pocket. I do have a healthcare insurance (an obligation under MM2H) but this only kicks in once you need to be hospitalized. The annual insurance premium depends on age, but for a couple in their fifties it is about RM5500 per year (USD 1300~1400). This insurance only covers domestic healthcare costs, so you'll have to add a travel insurance if you travel to other countries.

[xhkge]

Rather than food, climate, healthcare, and people, which others have covered, I'll mention some issues of bureaucracy.

According to the fine print, if you wanted to leave the MM2H program and withdraw your "deposit" then you needed to visit Malaysia to do that. In these times of more difficult travel that might be an issue for some. It's not something you can one day decide to walk away from and just ask them to send your money back.

And...without wanting to take the discussion down too gloomy a path, but perhaps a consideration for those of normal retirement age: what happens if you pass away and want to leave that money to your kids or whatever? It's probably going to be a non-trivial process to get that money unlocked, at least compared with HK where the procedures are a little less bureaucratic.

Also, moving forward tax may become an issue. Previously, income from outside Malaysia was not taxable while you were on the MM2H visa. But the world is changing rapidly in this regard and that may not be true in the future...especially if the program returns in a new guise, I'd be very careful to study the new rules in this regard.

One pro of HK is the extremely simple tax system, whereas in Malaysia things are in general much more complicated. I was told by a tax lawyer several years ago, for example, if you sell a property in Malaysia (an event for which the government withhold tax and you need to submit a tax return to try and offset any costs against any gains and claim all or part of the withheld tax back) you are then supposedly commited to submit a tax return for life, even if you leave the country.

I can attest (since I received a letter from HSBC a few weeks ago) if you hold a bank account in Malaysia, that bank will report you into CRS as a tax resident of Malaysia. What exactly this means for someone who hasn't stepped foot in the country for a decade like me I don't know.

Of course, there's no guarantee things will stay simple in HK forever. Here too, it could become more complicated, especially if HK tax legislation starts to align with that on the mainland.

[Taikoowan]

Thank very much @shri, @Windmill65 and xhkge.

I sold an apartment in KL 3 years ago, the taxation was straight forward. If I remember correctly the tax was deducted from the sale price, i.e. the buyer's solicitor needs to settle the capital gains on sellers behalf before the balance of sale proceed is handed over to the seller.
@Windmill65 - very useful information. Many thanks, especially about the dogs being allowed in some condos & cost of healthcare.

Thanks Shri, as always.

[shri]

According to the fine print, if you wanted to leave the MM2H program and withdraw your "deposit" then you needed to visit Malaysia to do that. In these times of more difficult travel that might be an issue for some. It's not something you can one day decide to walk away from and just ask them to send your money back.

And...without wanting to take the discussion down too gloomy a path, but perhaps a consideration for those of normal retirement age: what happens if you pass away and want to leave that money to your kids or whatever? It's probably going to be a non-trivial process to get that money unlocked, at least compared with HK where the procedures are a little less bureaucratic.

Have not researched these indepth but here are my thoughts about this:

- Cash in MM2H related deposits. The process might be bureaucratic but from my perspective the program has been in place for a while and I'm perhaps naively optimistic that there should be a well established process for withdrawal and probate. I am sure a few MM2H expats have passed away and as long as I am not the first person to encounter this... it will move on.

Besides, as an Indian, I have low expectations of any system in Asia or remnants of a colonial legacy. Am ok with it.

Do have to look into tax issues. I have a feeling that post covid spending, a fair few govts will be tightening up their tax collections to pay for the spending. Let's see where this ends up - in no rush to make any decisions either way. If you hold US stocks or assets there are bigger concerns in my mind compared to Malaysian tax system.

[ndt]

I have been closely following progress on MM2H and hooked to couple of useful sources who have sort of insider knowledge and regularly updating the development, KPMG's review of the program was interesting comparing with other programs around the world (i.e. Thailand, Portugal, Quebec etc) and likely proposed more streamlined pathways to the Govt, higher chances Govt will accept the proposal as it is and things are stuck in Cabinet on National security issue, Of course anything can happen when politics is involved but hopefully new scheme will be announced once Covid situation is under control.. On the whole, it looks like there was never an intention to scrap the program completely rather bring it under immigration authority from national security point of view in stead of originally under tourism dept.. Also the fact that there was sudden surge in application from certain country, 90% of which was rejected according to reports and recent 1MDB scandal etc all adds up and makes sense why they did what the did though i agree their complete neglect of MM2H holders during Covid has put many people in limbo and likely turned many away, not a good start if they are serious about revamped scheme and consider expats as long term assets for economy.. Anyway, which country hasn't fecked up during covid!! so am optimistic about the new scheme and fingers crossed..
@Windmill65 and @Cwbguy thanks for sharing first hand experience in the past and more in this thread..