SET UP A LABUAN TRADING COMPANY

Setting up a trading company in Labuan jurisdiction is an ideal choice as it offers a wide range of business activities permissible under the regulation of Labuan Financial Services Authority. Additionally, Labuan jurisdiction being a midshore jurisdiction, offers the provision of dealing with the local market which is subjected to the local tax regime. With this advantage, more business opportunities and flexible trading methods are generated for foreign and local owners.

KEY ADVANTAGES OF A LABUAN TRADING COMPANY

Corporate tax 3% on audited net profits for International dealings.
Corporate tax 24% on audited net profits for Malaysia dealings.
If annual revenue for Malaysia dealings is more than RM 500,000, 6% GST is applicable.
No withholding tax on interest, dividends, management fees and royalty.
No SST & GST.
No stamp duty on transfer of shares and in Labuan business activities.
0% personal income tax on Directors’ fees for foreign Directors.
50% tax rebate on personal income for foreign high management employments
65% tax rebate on personal income of Malaysian high management employments.
More than 70 countries in DTA.
Able deal with Malaysian by permanently elects corporate tax 24%.
Labuan offshore banks do not have foreign exchange control.
Labuan offshore banks imposed no tax on interest earned on deposit placements.

Types of Business Under A Labuan Company

TRADING	IMPORT & EXPORT	CONSULTANCY	E-COMMERCE
Trade in a vast variety of goods and services General Trader Commodities *Dealmaker	Transactions of goods and services across jurisdictions Importer Exporter Merchant Distributor *Wholesaler	A professional practice in giving expert opinion within a specific field Agency Trainer Advisor Coaching	Commercial transactions of goods and services over the Internet Online Store E-service provider *Digital Products

INTERNET MARKETER	FINANCIAL SERVICE PROVIDER	PROFESSIONALS	INVESTMENT HOLDING
Performing marketing strategies using the power of the Web Internet Advertiser Web Designer Blogger SEO Specialist	Providing financial products rendered by the financial institutes Forex Trader Banker Insurer Leasing *Fund Management	Professions that specialises in a specific professional activity Lawyers Accountants Auditors Broker Financial Planner Fund Manager	Holding assets and shares of other companies to earn dividends, rent or interest Real Estate Equity Bonds & Funds Gold and Raw Minerals *Company

Starting a Labuan Consultancy Business

The consultancy industry has gained a lot of traction in the recent years as the technology progresses enabling easy access to cross border consultancy services. A consultant is a specialist of a particular field offering professional advice on a specific subject matter. Setting up a Labuan company to conduct consultancy business is very easy as it does not require any trade license.

Starting a Labuan Import & Export Business

Presently, international trading being one of the most trending industries on the globe, is mainly due to the endless supply and demand of merchandises or commodities globally. As technology advances, international trade is becoming so convenient in securing transactions from every corner of the world. Within the Asia Pacific region, Labuan jurisdiction is very competitive due to its low corporate tax rate of 3% on net profit. In addition, senior management of the Labuan company is able to apply for a 2-year multiple entry working visa which permits them to stay in Malaysia.

Types of Consultancy Business:

ADVERTISING FIRM is engaged by a business to promote good strategies in online and offline advertising.
BUSINESS COACH is someone whom can identify the problem faced by the business and allocate a good solution to it which will help to maximise the profit of the business.
ENGINEERING CONSULTANT is hired to inspect the progress of the projects or to advise on specific software and technical aspects.
MARKET RESEARCH CONSULTANT is someone whom provide market research services on the particular field or country for new business exploration purposes.
EDUCATION PLACEMENT is someone whom expertise in education sector in foreign countries where they can provide good recommendation to students for further education.
COMPUTER CONSULTING FIRM can troubleshoot software and hardware problems.
EDITORIAL SERVICE produces flyers, newsletters to corporate annual reports.
TASKING CONSULTANT is someone whom works on tasks in a short term or part time basis for company that wanted to save some on their operating cost.
EXECUTIVE SEARCH is someone whom seek for talented employers for businesses like a recruiting firm.
INVESTMENT CONSULTANT is someone whom specialises in investment opportunities and diversifying wealth purposes for high net worth clients.

Types of Import and Export Businesses:

EXPORT MANAGEMENT COMPANY (EMC) manages export operations for a domestic company which sells its product to overseas ranging from hiring dealers, invoicing customers, representatives and distributors, handling advertising, marketing and promotion to arranging logistics. These activities are being paid in commission or salary basis or retainer including commission.
EXPORT TRADING COMPANY (ETC) works reversely from EMC, where they seek for foreign investors or buyers on the products they wanted and look for domestic company whom are ready to export. These activities are usually paid by commission.
IMPORT/EXPORT MERCHANT operates like a free agent where they purchase goods from the domestic company, repack and ship them to the foreign buyers on its own. Therefore, the merchant bears all the risks and retain all the profits.
MANUFACTURER'S REPRESENTATIVE is a salesperson who is an expert in a specific product or line of complementary products. Therefore, he can provide additional products assistance such as technical service and warehousing.
DISTRIBUTOR OR WHOLESALER is a company that purchase imported goods and distributes them to the retailer or other agent until the products reaches the end users.
REPRESENTATIVE is a sharp-witted salesperson who will introduce your products to the retailers in order to pass the sales to you.

Comparison between Hong Kong, Singapore and Labuan

	HONG KONG	SINGAPORE	LABUAN
GENERAL
Political Stability	Good	Good	Good
British Based System	Yes	Yes	Yes
Disclosure of Beneficial Owners	No	No	No
Governing Laws	Onshore Laws	Onshore Laws	Offshore Laws
CORPORATE
Minimum No. of Director	1	2 (1 Resident Director)	1
Minimum No. of Shareholder	1	1 Corporate or 2 Individuals	1
Corporate Directors Allowed	Yes	No	Yes
Company Secretary	Yes	Yes	Yes
Minimum Paid Up Capital	HKD 1	SGD 1	USD 1
Registered Office	Yes	Yes	Yes
Annual General Meeting	Yes	Yes	Yes
Location of Meeting	Anywhere	Anywhere	Anywhere
Filing of Directors Info with Registry	Yes	Yes	Yes
Filing of Shareholders Info with Registry	Yes	Yes	Yes
TAXATION
Corporate Tax Rate	8% to 16.5%	0% to 17%	0% to 3%
Audit Report	Yes	Yes	Yes
Double Taxation Act	29 Countries	70 Countries	74 Countries
Withholding Tax	No	15%	No
Bank Account in Multi-Currencies	Yes	Yes	Yes
BUSINESS VISA
2-year multiple entry renewable	No	No	Yes
Dependent visa	No	No	Yes