Labuan Trust service in Malaysia
Formation Of A Labuan Company
Labuan trust service in malaysia
Formation Of A Labuan Company
Are you interested in the formation of a Labuan Company? Did you know that there are two main types of Labuan Company structures? They are the Trading Company and the Non-Trading Company—these two types differ in tax liability and flexibility. So based on the nature of your business, the formation requirements will vary.
Do note that the Labuan Company formation can be done within seven working days once completed documents have been submitted by the client. Additionally, it is important to remember that all Labuan Companies must transact in foreign currency and not in Malaysian Ringgit.
Formation Of A Labuan Trading Company
The Labuan Trading Company is defined through trading activities that include import, export, trading, shipping, consultancy, management, banking, insurance, finance, and other business activities that do not fall under the non-trading category.
If you are forming a Labuan Trading Company, you will only be required to pay 3% tax on your net profit based on the 1990 Labuan Business Activity Tax Act. Additionally, all Labuan Trading Companies’ accounts are required to be audited yearly. Do note that if your deal with Malaysian companies or Malaysian residents, you are allowed to make an irrevocable election to be taxed under the onshore 1967 Malaysia Income Tax Act—the corporate tax rate will be 24% on your net profit, and all billings have to be made in foreign currencies.
Formation Of A Labuan Non-Trading Company
A Labuan Non-Trading Company is defined through non-trading activities that include investment, bonds, stock, shares, and deposits. There are no requirements for tax and yearly auditing on all accounts unless it is a management account which will then be required to adhere to the annual tax compliance.
Do note that real estate investment in Malaysia by a Labuan Company falls under the non-trading category. However, once rental income is received, the company will be subjected to the onshore 1967 Malaysia Income Tax Act with the required 24% tax rate on your net profit as well as yearly audits.
At Klozer, our team specializes in the formation of a Labuan Company for both trading and non-trading structures. Our experience and professionality allow us to assist you from the simplest tasks to the more complex procedures. So if you’re looking for experts that can provide both assistance and advice, get in touch with us today and we will schedule an appointment with you soon.