Labuan Business Activity
What Why you should consider managing and planning for your wealth, succession planning and charitable foundations in Labuan
The following income is exempted from income tax:
- Dividends received from Labuan entities
- Distributions received from Labuan trusts and foundations (including both Islamic) by the beneficiaries
- Distributions of profits by Labuan partnerships (including Islamic partnerships)
- Interest received by residents*, non-residents* or another Labuan entity from a Labuan entity.
- Royalties and fees for services, advices or assistance specified in Section 4A (i) and (ii) of the Malaysia Income Tax Act 1967 (ITA), received by a non-resident or another Labuan entity from a Labuan entity.
- Other gains or profits under Section 4(f) of ITA received by a non-resident from a Labuan entity
No withholding tax is imposed:
- on payments to non-residents for interest, royalties, fees for services, advice or assistance, or other gains or profits under Section 4(f) of ITA by a Labuan entity
- on payments to non-residents for use of moveable properties by a Labuan licensed leasing company.
|Labuan entity carrying on a Labuan business activity||Minimum number of full time employees in Labuan||Minimum amount of annual operating expenditure in Labuan (RM)|
|1.||Labuan insurer, Labuan reinsurer, Labuan takaful operator or Labuan retakaful operator||4||150,000|
|2.||Labuan underwriting manager or Labuan underwriting takaful manager||4||100,000|
|3.||Labuan insurance manager or Labuan takaful manager||4||100,000|
|4.||Labuan insurance broker or Labuan takaful broker||4||100,000|
|5.||Labuan captive insurer or Labuan captive takaful||4||100,000|
|6.||Labuan International Commodity Trading Company||3||3,000,000|
|7.||Labuan bank, Labuan investment bank, Labuan Islamic bank or Labuan Islamic investment bank||3||180,000|
|8.||Labuan trust company||3||120,000|
|9.||Labuan leasing company or Labuan Islamic leasing company||2||100,000|
|10.||Labuan credit token company or Labuan Islamic credit token company||2||100,000|
|11.||Labuan development finance company or Labuan Islamic development finance company||2||100,000|
|12.||Labuan building credit company or Labuan Islamic building credit company||2||100,000|
|13.||Labuan factoring company or Labuan Islamic factoring company||2||100,000|
|14.||Labuan money broker or Labuan Islamic money broker||2||100,000|
|15.||Labuan fund manager||2||100,000|
|16.||Labuan securities licensee or Labuan Islamic securities licensee||2||100,000|
|17.||Labuan fund administrator||2||100,000|
|18.||Labuan company management||2||100,000|
|19.||Labuan International Financial Exchange||2||120,000|
|20.||Self-regulatory organisation or Islamic self-regulation organisation||2||120,000|
Do you need further clarification?
Ask our friendly consultants today on any matters relating to taxation in Labuan. No obligations, we are here to help.