Benefits of Setting Up Labuan Company by Malaysians
When using entities overseas entities such as Hong Kong Company, BVI, Seychelles, etc, it can be difficult to justify and prove to Inland Revenue Board (IRB) for all incomes received from abroad without being taxed. By setting up a Labuan company either by Malaysian individuals or corporate, it is a legitimate way to remit foreign source income to Malaysia tax-free, without the need to show proof to IRB as it has been provided for under the Income Tax Exemption Order that all dividends received are tax exempt.
On top of that, the Labuan company can be set up for trading or non-trading activities purposes where the corporate tax is only 3% on net profits. Unlike tax haven entities, using Labuan as the hub is not a tax avoidance structure. The Labuan offshore bank account is also not subject to Malaysia Exchange Control where an unlimited amount of foreign currencies can legally flow freely with the approval from the Labuan bank itself.
The Labuan offshore banks can also provide various trade facilities such as Letter of Credit, Commercial loans, Bankers Acceptance, etc to facilitate your business needs.
For Labuan companies that meet the listing criteria, it is eligible to be listed on various stock exchanges like HKex, SGX and ASX using foreign currency denomination for fundraising. Labuan companies operate using foreign currencies which is an ideal entity to be considered for listing purposes.
Feel free to contact us by sending us the enquiry form to explore the best type of Labuan entity to meet your business objectives. We “simplify the complexities” of your Labuan investment.