Why should Businesses set up a Labuan Offshore Company?

One must weigh in his or her options before opportunity knocks. This is true for businesses as well for investing in a company at the right place and time can ensure handsome returns. In the competitive world of business where staying afloat has become difficult let alone succeed, finding a suitable business destination offering plenty of opportunities can be a godsend. In the last decade or so, Malaysia has emerged as a powerful economy, especially in the Asian region, for businesses to invest and grow. To incentivize global businesses, Malaysia has set up several regions to serve as the hubs. Labuan happens to be one such region that offers a slew of benefits like reduced tax liability, better brand equity, and a seamless procedure for Labuan company registration. It has gained the reputation of being one of the prominent offshore financial centres in Asia where several multinational companies are setting up their infrastructure and grow their business. 

Benefits of establishing a Labuan offshore company  

Thanks to its no-tax regime and business-friendly policies, Labuan offers a multitude of benefits for global businesses in terms of asset protection, privacy, tax-free trading, and many more. The other benefits of setting up a Labuan offshore company are as follows: 

Protection of assets: Most businesses are wary of investing in foreign destinations due to the possibility of losing their assets should any lawsuit is filed against them. The same can happen with a Limited Liability Company (LLC) or Corporation but not with an offshore company. Since there are no capital gains taxes or inheritance tax in Labuan, a foreign company can own properties overseas. Further, by owning a Labuan offshore company, you can minimize or eliminate the complexities of probate for your next of kin or heirs in case you are no longer around. Also, you can have full ownership of a company or have multiple partners to own it without paying any inheritance tax. So, any transfer of assets or ownership can be completed through share transfers and there is no need to have a local Malaysian partner, like in other parts of Malaysia.  

Savings on taxes: The special investment zone in Labuan does not have any Goods and Services Tax (GST) levied on sales transactions taking place in the region. On the other hand, in other parts of the country, companies have to pay a 6 percent GST rate. Also, Labuan does not levy taxes on interest, dividends, royalties, technical, and management fees. Such a comprehensive tax exemption policy truly helps companies to remain profitable and competitive. 

Quick registration: The process of Labuan company registration is a simple, convenient, and quick one with just 7 days to complete. Companies have to register themselves with the SSM, the Malaysian Companies Commission, and use Labuan as their launch pads. In fact, consulting companies like Premier three can help foreign investors in incorporating their companies, even while they reside in their native countries. 

Low paid-up capital: The requirement for a huge paid-up capital is often the Achilles’ heel of companies. However, Labuan offers a minuscule 1 USD as the paid-up capital for businesses to register. This brings down the initial cost of investment to a considerable degree. 

Anonymity: Although this is not a tax haven to safeguard someone’s ill-gotten wealth, no information related to the directors, shareholders, or beneficiaries of a Labuan offshore company is publicly published or disclosed by the registrar. In other words, one can invest in this offshore financial paradise while remaining anonymous. 

Conclusion

The myriad benefits accrued to businesses investing in the Labuan region in Malaysia are something to consider, especially in today’s competitive times when strategic thinking and implementation can lead to success. To know more about Labuan and get help for Labuan company registration, contact Premier Three.