Labuan Company as Headquarters for Regional and Representative Office
Ways to maximize your return using a Labuan Company as Headquarters for Regional/Representative Offices set-up in various jurisdiction
If you are planning an international business and would like to set up office in various countries, situating Headquarters at Labuan can position your company for international growth and meet requirements guided by other countries. With your Headquarters set up in Labuan, your business can meet many of these requirements and when revenues are channeled through the Labuan entity, you can enjoy low corporate taxes of 3% or a flat fee of RM20,000!
A typical example: An E-Commerce Company using Labuan as a Regional Headquarters
A newly established E-Commerce company seeks to incorporate in Labuan and has plans to penetrate markets across Asia, especially South East Asia. The company intends to set up Representative Offices in each market that it serves, while situating its Regional Base (Headquarters) in Labuan. The representative offices allows the business owners to send their representatives to source opportunities and any sales concluded the billing will come from Labuan Company to enjoy low tax.
Examples of requirements for Regional/Representative Offices (RO) for various countries include:
Singapore Representative Office
RO is not a legal entity
Parent company is implicitly responsible for all liabilities of RO
Applications by foreign commercial entity must fulfill certain minimum criteria
Thailand Representative Office
Considered as a non-trading office
Not permitted to conduct business with a view to profit
Permission must be applied for prior to commencement of business
Vietnam Representative Office
Can act as a liaison office of its foreign head office
Not a separate legal entity
Not allowed to generate revenue
Situating its Headquarters in Labuan, while having a regional/representative offices in other countries benefits the company because:
- Strategically positioned to tap into ASEAN base, including ease of regional travel
- Low cost of conducting business, keeping overhead costs under control
- Can meet requirements laid out by countries in which Representative Offices are located
- Entire business can be structured to be tax efficient – no withholding taxes and low corporate taxes
- Choice to hire foreign expatriates to the Headquarters with 2-years renewal business visa
- Foreign directors hired by Labuan company may be exempted from Malaysia personal income tax (a special provision until 2020!)
- Permissible to do on shore and off shore Malaysia business
Find out complete advantanges of Labuan company!
Ultimately how you intend to structure your business depends on your business objectives and goals. At CP Trust, we guide our clients on how they can best achieve their goals and enjoy the extras that Labuan mid-shore jurisdiction offers!
CP Trust as Your Trust Company
We provide consultation on company structure for Labuan, profiling of documentation and due diligence of company application, assist in providing the registered office and back-end support to ease your operations. We can provide assistance from start to finish in helping you set up your Labuan business. Consult us today!
Feel free to call us at +603-2161 0354, email firstname.lastname@example.org or fill in this enquiry form to consult us on how to best structure your business! We are here to “simplify the complexities” to get your business up and running!