Why Labuan Is Asia's Hotbed for International Business

Labuan International Business Financial Centre is an ideal mid-shore jurisdiction for expatriates to leverage the low tax regime. At the same time, you can obtain a Corporate Tax Resident Certificate to confirm your Resident status and a Personal Tax Certification.  This validates your personal resident status and Work Permit in Malaysia.
These certificates can be easily obtained from the Malaysian Inland Revenue Department. As a Tax Resident in Malaysia, a Labuan Company can mitigate potential risks for a dual resident applicant who could be exposed to taxes of more than one jurisdiction.

With the Common Reporting Standard (CRS) in place, tax authorities can freely exchange financial information through the Automatic Exchange of Information (AEOI) on expatriates residing in their home country for tax assessment purposes. This implementation will greatly impact jurisdictions offering ZERO Tax and no issuance of a Tax Certificate for both the company and expatriates. ZERO Tax jurisdictions often lack infrastructures to assist businesses with real commercial substance creation.

All international entrepreneurs have been pressured to prove their existence and business operation in that particular jurisdiction. Under Labuan, it is easy to create a real and affordable commercial substance with excellent support of good infrastructure, especially for business dealings within the ASEAN region, due to these main three factors:

Strategically located within Asia Pacific region

Easy access within hours by international flights to Labuan for meetings, banking and urgent matters, comparing to other jurisdictions which may take days to get to.

Sharing common time zone with Asian cities

It enhances operations efficiency level as it minimises lagging in communications due to the long waiting time.

Infrastructures ready and made available

Labuan Company has the ability to demonstrate its highest level of control as a result of influencing the Automatic Exchange of Information (AEOI), with relatively low cost compared to neighbouring jurisdictions such as Singapore and Hong Kong.

Why Labuan Is Asia's Hotbed for International Business?

Labuan International Business Financial Centre is an ideal mid-shore jurisdiction for expatriates to leverage on the low tax regime and at the same time able to obtain a Corporate Tax Resident Certificate to confirm resident status as well as Personal Tax Certification to validate personal resident status in Malaysia. These certificates can be easily obtained from the Malaysian Inland Revenue Department. As a Tax Resident in Malaysia, a Labuan Company is able to mitigate potential risks for a dual resident applicant who could be exposed to tax of more than one jurisdiction.

With the Common Reporting Standard (CRS) in place and in progress, tax authorities are allowed to freely exchange financial information through the Automatic Exchange of Information (AEOI) on expatriates residing in their home country for tax assessment purpose. This implementation will bring great impact to jurisdictions offering ZERO Tax and no issuance of a Tax Certificate for both the company and expatriates. ZERO Tax jurisdictions often lack infrastructures to assist businesses with real commercial substance creation.

All international entrepreneurs have been pressured to proof their existence and business operation in that particular jurisdiction. Under Labuan, it is easy to create real commercial substance with much affordability and support of good infrastructure especially for business dealings within the ASEAN region due to these main three factors:

Strategically located within Asia Pacific region – Easy access within hours by international flights to Labuan for meetings, banking and urgent matters, comparing to other jurisdictions which take days to get to.

Sharing common time zone with Asian cities – It enhances operations efficiency level as it minimises lagging in communications due to long waiting time.

Infrastructures ready and made available – Labuan Company has the ability to demonstrate its highest level of control as a result of influencing the Automatic Exchange of Information (AEOI), with relatively low cost compared to neighbouring jurisdictions such as Singapore and Hong Kong.

20 Reasons Why Labuan Is The Ideal Jurisdiction To Start An Offshore Company

  • 100% foreign ownership (Malaysian partners not required)
  • 3% corporate tax for trading activities
  • 0% tax for Investment Holding activities
  • 24% local tax for Malaysian dealings
  • Can be listed in Malaysia, Singapore, Hong Kong, Australia & Dubai
  • No Trade License required to operate business
  • Corporate Bank Accounts in MYR and Foreign Currencies
  • No Foreign Exchange controls
  • Fast incorporation within 5 to 7 working days
  • Operate business remotely from anywhere
  • NO Tax on Dividend payouts
  • NO SST, GST and Stamp Duty
  • NO Withholding Tax
  • NO Capital Gain Tax and Inheritance Tax
  • NO Personal Tax for all Foreign Directors’ Fee
  • 50% Personal Tax rebate for all Foreign Employments
  • Access to more than 70 Malaysia Treaty Partners!
  • Virtual / Office Room Rental in Labuan
  • 2 years multiple entry renewable Labuan Working Visa
  • Able to stay anywhere within Malaysia
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SHARE CAPITAL
SHARE CAPITAL
  • Permitted any foreign currency except Ringgit Malaysia
  • No min. capital
  • No authorized share capital
  • Shares issued shall have no par or nominal value
  • Treasury shares are allowed
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DIRECTORS / SHAREHOLDERS
  • min. one (1) Director
  • min. one (1) Shareholder
  • Local director is optional
  • Allowed corporate director or shareholder
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SECRETARIAL AND OFFICES
  • Min. one (1) resident secretary i.e. a Trust Officer of a Trust Company or a Labuan/Malaysian domestic company wholly-owned by the Labuan Trust Company
  • Required principal office of a Trust Company in Labuan
  • Accounts required to be kept in Labuan
  • Audit and filing is required
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COMPANY STRUCTURE
  • Amalgamation by merging two (2) or more companies into one (1) is allowed
  • Corporate re-domiciliation is allowed
  • No public accessible to management or shareholding structure
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ANNUAL REQUIREMENTS
  • Annual Return is required to lodge not later than thirty (30) days from the anniversary date of company incorporation
  • Annual Government fee is required to pay on or before the anniversary date of company incorporation
  • Annual Tax Return needs to be filed with the Malaysian Director General of Inland Revenue by 31st March of that year of assessment (extension of time is allowed)
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BANKING SOLUTIONS
  • Onshore and Offshore Bank Account
  • Corporate Banking
  • Personal Banking
  • Open Bank Account in Malaysia, Singapore, Hong Kong, etc.
  • Multiple Foreign Currencies Account i.e. MYR, USD, SGD, AUD, GBP, RMB, YEN, EURO, HKD, NZD, AED, etc.
  • Corporate Debit Card
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