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FAQ on Incorporation of Labuan Company

Labuan trading company  is defined as a company that engages in business activity , which includes banking, insurance, trading, management, licensing, import, export, consultancy, wholesaler, agency and commissioner. A Labuan trading company allows business owners to enjoy corporate tax rate as low as 3% on audited profit and permitted to deal with local residents.

A Labuan non-trading company is defined as a company that engages in business activity relating to the holding of investments in securities, stocks, shares, loans, deposits and immovable properties. Earning of a Labuan investment holding company is tax exempted. It requires annual tax return filing to Labuan Inland Revenue Board with a management account, no audit report needed.

Step 1: Background Checks & Nature of Intended Business Activity

Provide us a copy of passport of all directors and shareholders for background checks and inform us of your intend nature of business activity.

Step 2: Submission of Form and Reference Letter and Proof of Residential Address

Duly completed Incorporation Form are the essential document for the incorporation. Other required supporting documents such as Character Reference Letter and Proof of Address are to be submitted as well.

Step 3: Engaging a Trust Company and Payment of Fees

All applicants are to engage a Trust Company for their incorporation. A duly signed Engagement Service Agreement is to be submitted. All fees are due and paid as per the service agreement have to be made at this point. 

Step 4: Reserved Company Name and Lodgement of Incorporation Documents

Applicants are ready for lodging their application formally to the authority. Signed copies of all pre-incorporation documents will be submitted to complete the incorporation lodgement.

The estimated time is within 5 to 7  working days upon receiving completed documents and supporting information from applicants.

There is a minimum one director and one shareholder to incorporate a Labuan Company. Both director and the shareholder can be the same person. The maximum number of director and shareholder is 5o for each capacity. The director and shareholder can be corporate entity. Please click here for complete info on how to register a Labuan Company.

Yes. Can be individual or legal person.

Yes, it is required as a proof of commercial substance. Generally, it is advisable to hold a meeting in Labuan to approve key management decisions. For Licensed Labuan entities, such as banks, insurance, exchanges and etc, it is required to meet the minimum number of staff and annual spending each year.
Check out the CRS solutions for Labuan Company.

Yes. The marketing office can be set up anywhere in Malaysia with unlimited number of staffs. However, the operational office has to be in Labuan.

Yes. All Labuan companies are encouraged to engaged the employment or recruitment of local Malaysians for their businesses. Tricor TrustCo can help businesses with our Staff Recruitment Service should the need arises. As a local Malaysian trust company, we are familiar with local staffs sourcing from the large pool of potential skilled and unskilled employees.

No. Labuan is one of the best justification which promotes confidentiality, with no public access. The information can only be given upon approval from the Directors or by order of the Malaysia Courts of Judiciary.

You can engage the services of foreigners to work for your Labuan Company. The Company can apply for two years’ multiple entry visa for your expatriates working for your Labuan company. The visa holders can stay anywhere in Malaysia except Sabah and Sarawak to perform his work duty.

Yearly compliance obligations such as annual return, corporate tax filing, employer’s return, and personal tax filings are timely submitted and in order.

Two options are available to close a Labuan company. They are either by strike off by Labuan Authority or you can apply for dissolution of the company.

Feel free to drop us an inquiry to advise if Labuan company fit to meet your objective in Malaysia with advice on the right structure for your Labuan Company set-up.

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