CTA Button : Contact Us (Link to Enquiry Form)
Company Secretarial Services
• A Labuan company is incorporated under the Labuan Companies Act 1990 (“LCA”) and enjoys preferential tax benefits provided under the Labuan Business Activity Tax Act 1990 (“LBATA”).
• It can engage in various business activities, including trading and investment in Labuan.
• Labuan investment activity involves holding investments, while Labuan trading activity includes banking, insurance, and more.
• Labuan Company can apply for Licensing required for specific sectors like banking & financial services, insurance & takaful, fund management, capital markets ,wealth management, digital financial services, commodity trading and ship registry (“Labuan Licensed Companies”).
• Both residents and non-residents can establish Labuan companies.
• Transactions with residents require notification to Labuan FSA.
• Business transactions should be in foreign currencies other than MYR, except for specific purposes.
• Labuan companies can own stakes in Malaysian domestic companies and engage in shipping operations with non-residents.
• Summary showing different Labuan business activities and its tax treatment.
Business Activity | Tax Treatment |
Labuan Investment Activity | Not subject to Tax |
Labuan Trading Activity | 3% of net profits as per audited accounts |
Carry out both Labuan Trading and Investment Activities | Same tax as Labuan Trading Activity at 3% of net profits as per audited accounts |
Non Labuan Business Activities | 25% tax under Malaysia’s domestic Income Tax Act 1967 (“ITA”) |
Labuan Company can irrevocably elect to be taxed under Income Tax Act 1967 instead of LBATA.
Labuan Investment Holding Company
• A Labuan Company serves as a structuring solution, consolidating foreign companies under one holding company with preserved ownership.
• Labuan Investment Holding Company can acquires overseas assets with ZERO tax, and be listed on major stock exchanges in Singapore, Hong Kong, Australia, Dubai or Taiwan for IPOs or RTOs.
• It also functions as an investment holding company for shareholders of a public listed company (PLC).
• Tax-free dividends and occasional stock holdings enjoy 0% tax on capital gains, while foreign capital gains and rental proceeds are taxable in respective jurisdictions.
Licensing Requirements
Requirements | Details |
Incorporation Agent | Appoint a Labuan Trust Company to: · Provide registered office & resident secretary. · Performs secretarial duties for documents lodgement. · Availability of its trust officers for appointment as resident director & secretary. |
Share capital | Minimum one share (with no minimum per share value) In any currencies, except MYR. |
Directors & Shareholders | At least one director and one shareholder, which can be the same person |
Operational Requirements
Requirements | Details |
Company Secretary | At least 1 resident secretary which shall be a Labuan Trust Company |
Registered Office | Principal Office of the appointed Company Secretary |
Accounting Requirement | Only required for b) Licensed Labuan Companies |
Management Office & Marketing Office | Labuan Trading Company may apply to establish marketing offices within Malaysia. Labuan Investment Holding Company may apply to Co-locate its management and marketing offices in Kuala Lumpur, with irrevocable election for ITA taxation. All Labuan companies with marketing or co-located offices must maintain a management office in Labuan island, except for insurance or takaful brokers and captives.. |
Annual Fee | Labuan Company : Annual Fee : USD800 Foreign Labuan Company Annual Fee : USD1,500 |
To find out how Hans Advisory can assist you, please do contact us now !
Steps
