Labuan Desk

On 1 July 2020, our firm received approval from the Labuan Financial Services Authority as approved auditors for companies incorporated under the Labuan Companies Act1990. This recognition has expanded our service coverage into new territory, Labuan. Acts that govern businesses in Labuan are as follows: 

1. Labuan Business Activity Tax Act 1990 (“LBATA”)
2. Amendment to the Labuan Business Activity Tax Act (Finance Bill 2018)
3. Labuan Companies Act 1990
4. Labuan Trusts Act 1996
5. Labuan Financial Services Authority Act 1996
6. Labuan Financial Services and Securities Act 2010
7. Labuan Islamic Financial Services and Securities Act 2010
8. Labuan Foundation Act 2010
9. Labuan Limited Partnerships and Limited Liability partnerships Act 2010.

Labuan companies can trade in any currency with any country.

A LABUAN COMPANY MAY ENJOY:

1. Access to more than 70 Double Taxation Agreements that Malaysia has signed.
2. A competitive tax regime.

 Labuan business activities as defined in the Labuan Business Activity Tax 1990 (LBATA 1990) provides:

• Taxation at 3% of net audited profits, if the company is undertaking Labuan trading activity and meets certain conditions including substance requirements.
• Companies carrying out only Labuan non-trading activity is not charged tax, i.e. 0%.
• A Labuan company may make an irrevocable election to be subjected to tax pursuant to the Malaysian Income Tax Act (MITA 1967) where the prevailing income tax rate is generally 24%.