Labuan, Malaysia

One of the most renowned financial centers in Southeast Asia. A Malaysia international financial and business services center. Complete exemption from income tax on profits for holding companies

Labuan Population:

100,000 (2017)

Official language:

The official language is Bahasa Malaysia. However, English is widely spoken and many documents and publications are available in English.

Labuan is one of the Malaysian federal government territories. The island is administered by the federal government through the Ministry of Federal Territories. Labuan Corporation is the municipal government for the island and is headed by a chairman who is responsible for development and administration of the island.

The economy of Labuan thrives on its vast oil and gas resources and international investment and banking services. Labuan is a very much an import-export oriented economy.

Currency:

Exchange Control: Labuan company can open foreign accounts with any banks in Labuan or outside Labuan. However, the account name must be the Labuan company name. ... The operations of Labuan companies in Labuan IBFC are completely free from exchange control regulations when dealing with non-residents.

Exchange Control:

Labuan company can open foreign accounts with any banks in Labuan or outside Labuan. However, the account name must be the Labuan company name. ... The operations of Labuan companies in Labuan IBFC are completely free from exchange control regulations when dealing with non-residents.

Financial services industry:

The financial services industry in Labuan has taken root thanks to the creation of the Labuan International Offshore Financial Centre in 1990, along with the passing of a batch of offshore laws and the creation of LOFSA (Labuan Offshore Financial Services Authority). With the passage of new laws to govern its business environment in 2010, LOFSA has since re-branded itself as Labuan FSA (Labuan Financial Services Authority), and the center itself as the IBFC (Labuan International Business and Finance Centre).

Read more: Labuan offshore bank account

A Labuan company is a company incorporated under the Labuan Companies Act 1990 (LCA 1990). Companies under this Act are allowed to carry out business in, from or through Labuan in order to enjoy its tax neutrality. Click here for details. 

Type of Company/Corporation:

Labuan Company (Limited by Shares)

Business Restrictions:

Offshore Non-Trading Activity refers to an activity relating to the holding of investments in securities, stocks, shares, loans, deposits and immovable properties by an offshore company on its own behalf.

Company Name Restriction:

The Registrar must not register a company with a name:

• is similar to or identical to an existing company. A name that implies illegal activities. A name that implies royal or government patronage.
• is expressed in any language using the Latin alphabet, if the Registrar of Companies is in receipt of an English translation and the name is not considered undesirable. Chinese names are possible.
• Names Requiring Consent or a License Bank, building society, savings, loans, insurance, assurance, reinsurance, fund management, investment fund, trust, trustees, Chamber of Commerce, university, municipal or their foreign language equivalents.

Company Information privacy: In Labuan offshore company set up, all information is not in public record, hence privacy is guaranteed by statute for the company officers, shareholders and beneficial owners.

• Step 1: Select basic Resident/Founder nationality information and other additional services which you want (if any).
• Step 2: Register or login and fill in the company names and director/ shareholder(s) and fill in the billing address and special request (if any).
• Step 3: Choose your payment method (We accept payment by Credit/Debit Card, PayPal or Wire Transfer).
• Step 4: You will receive soft copies of necessary documents including: Certificate of Incorporation, Business Registration, Memorandum and Articles of Association, etc. Then, your new company in Labuan is ready to do business. You can bring the documents in company kit to open corporate bank account or we can help you with our long experience of Banking support service.

• Passport of each shareholder/beneficial owner and director;
• Proof of residential address of each director and shareholder (Must be in English or certified translation version);

Read more:

• Setting up a company in Labuan
• Labuan company registration fees

Capital:

The standard total authorized capital is $10,000 USD.

Share:

Labuan Company shares may be issued in a variety of forms and classifications and may include: Par or No Par Value, voting or non-voting, Preferential or Common and Registered.

Director:

Only one director is required.

Directors may be of any nationality and reside in any country

Director must be a natural person.

Shareholder:

Only one shareholder is required.

Shareholder may be of any nationality and reside in any country

Shareholder may be either a natural person or a corporate entity.

Nominee Shareholders and directors are allowed and we can provide this service.

Beneficial Owner:

The information on the Beneficial Owners is kept at the Registered Office and not available to the public.

We offer Nominee Services for Labuan corporations to provide for your further confidentiality and privacy.

Taxation:

The Labuan tax rate is 3% upon the chargeable income from only the Labuan trading activities. This means the income from the Labuan non-trading activities (– ie the holding of investments in securities, stocks, shares, loans, deposits or other properties) of a Labuan entity is not subject to tax at all. 

Finance statement:

Filing an annual report is required. All management accounts require to be audited by a Labuan auditor. No audit report is required for holding company.

Local Agent:

A Labuan company is required to maintain a local office address provided by a local agent as its registered address.

Double Taxation Agreements:

Labuan companies can benefit from all the double tax treaties signed by Malaysia. Malaysia has a comprehensive tax treaty regime and has concluded and signed some 63 tax treaties of which 48 are fully in force. Malaysia’s tax treaty policy aims at avoiding double taxation and encouraging foreign direct investment. The Malaysian tax treaties are modeled on the Organization for Economic Co-operation and Development’s model treaty with some modifications. It should be noted that Malaysia’s double tax treaty with the United States provides reciprocal exemption to international shipping and air transportation businesses only.

License Fee & Levy:

Incorporation in Labuan are required to apply to the Labuan IBFC for a business licence. Once the application is approved, the required fee is sent to the Inland Revenue Department for payment. Upon receipt of payment, IRD issues a business certificate.

Payment, Company return due Date:

Annual maintenance fees which are due on the anniversary date of incorporation.

Penalty:

Annual fee paid after the due date: A Labuan company that fails to pay the annual fee by the due date shall, in addition to the annual fee, pay a penalty of an amount of penalty decided by Labuan IBFC.