Wealth Management / Trust

Trust

A Labuan private trust company (PTC) is a Labuan company formed for the specific purpose of acting as a trustee for a group of connected persons and where each beneficiary of the trust established by the PTC is a connected person related to the settlor of the trust. In a PTC, the settlor, members of his family or his advisers can be appointed to the board of directors. The composition of the board can be changed from time to time to bring in members of succeeding generations and in this way, involve them in the management of family affairs.

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Permitted Activities

A Labuan private trust company may only provide the trust company services to the private trust.

Tax Regime in Labuan

Labuan jurisdiction is known as mid-shore where Labuan entity has two different tax systems, which are Income Tax Act 1967 and Labuan Business Activity Tax Act 1990 depending on the nature of business.

Labuan Business Activity Tax Act 1990

Labuan Trading Company

Labuan trading company are taxed under Labuan Business Activity Tax Act 1990 which is 3% of its audited net profit with fulfilled substance requirements.

Labuan Non-Trading Company

Labuan Non-Trading Company is also an investment holding company. A Labuan investment holding company is divided to two category which is pure and non-pure equity holding.

Labuan Non-Trading Companies are not subjected to tax (0% tax) with the submission of yearly management account and fulfilled substance requirement.

Document required for company incorporation

Individual (shareholder/director)

For corporate’s shareholder/director

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FAQ

One share in any denomination in foreign currency except Malaysia Ringgit

Approximately 7-14 business days upon complete collection of the required documents

The director and the shareholder must be at least one person and can be the same person. It
can be fully owned by a foreigner.

A resident secretary is required.

• Trading company – please see attachment “LFSA – Code 20” for allowed activities under trading company.
• Non-trading company/investment holding – income mainly from dividend or interest.
*Kindly take note that the tax for general trading or import/export services is ranging from 15% – 24% under Malaysia Income Tax Act 1967.

• Trading company companies are taxed under Malaysia Income Tax Act 1967, which the tax ranging from 15%-24% of its profit except for Labuan licensed company. (Audit required)
• Tax for Labuan licensed company and business nature under “Code 20” is 3% of its audited net profit with fulfilled its substance requirements. (Audit required)
• Investment holding companies are not subjected to tax (0% tax) with the submission of yearly management account and fulfilled substance requirement.

No.

• CTC of Passport
• CTC of Proof of address (such as the most recent utility bill, internet bill, insurance statement, etc)
*CTC – Certified True Copies: Certification of documents must be made by competent persons such as a notary public, solicitor, chartered secretary, or certified public accountant,
and made in accordance with the law in Malaysia or in the country where the certification was made.

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