What is land conversion/change of category of land use?
Pursuant to Section 52 of the National Land Code 1965, all alienated lands are divided into three (3) categories of land use i.e. “Agriculture”, “Building” and “Industry”. All land owners must use the land in accordance to the category of land use and the express condition stipulated in the title. Failure to do so is a breach of condition of the land alienated and the State Authority can forfeit the land.
As such any land owner who intends to use his land for another category of use other than the category stated in the title, must apply to change the category of land use accordingly. Sections 124 and 124A of the National Land Code and the respective State Land Rules allow landowners to apply for such changes. The State Authority will charge an additional premium on all applications approved for change of use.
How to calculate the Conversion Premium in Selangor?
Before calculating conversion premium, land owners need to find out the “Improved Value” of the land. “Improved Value” means the value of the said land after conversion of the land. Final “Improved Value” to calculate the conversion premium shall be determined by JPPH.
Eg. Abu plan to convert his agriculture land in Selangor to residential land. In order for him to calculate the conversion premium, he need to find out the land value base on residential status. Then Abu can use “Selangor Land Conversion Premium Calculator” to calculate the conversion premium.
Calculation: Improved Value x Conversion Premium Rate = Conversion Premium
| Conversion Premium in Selangor | ||
| Agriculture to Residential | : | 15% |
| Agriculture to Commercial | : | 30% |
| Agriculture to Industrial | ||
| -Light Industrial | : | 20% |
| -Medium Industrial | : | 25% |
| -Heavy Industrial | : | 30% |
| Residential to Commercial | : | 15% |
| Industrial to Commercial | : | 10% |
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