Labuan International Business and Financial Centre is one of Asia's most well-established and respected offshore jurisdictions, combining a competitive tax environment with a robust legal framework and genuine political stability.
Labuan companies pay only 3% tax on net audited profits from trading activities, one of the lowest rates in Asia for an internationally recognised jurisdiction.
Investment holding income (including dividends, interest and royalties) is completely exempt from tax in Labuan.
Malaysia has concluded double tax agreements with over 70 countries, the majority of which extend to Labuan structures, providing significant treaty protection for international investors.
Over three decades of development have made Labuan a mature, well-regulated jurisdiction with its own set of offshore legislation and a dedicated financial services regulator: Labuan FSA.
Labuan operates in the same time zone as Singapore, Hong Kong, Beijing and Manila, making it operationally convenient for businesses across the Asia-Pacific region.
All licensing, compliance and regulatory matters are handled through one body, Labuan FSA, keeping the process straightforward and efficient for business owners.
Labuan trading companies (those engaged in substantive business activities) pay a flat 3% on net audited profits. This applies to banking, insurance, trading, and a wide range of services.
Companies used solely for investment holding purposes pay no tax whatsoever on their investment income. This makes Labuan an ideal location for holding structures and family offices.
There is no capital gains tax and no withholding tax on dividends paid from a Labuan company, allowing efficient repatriation of profits for international shareholders.
Labuan operates under Malaysian law and enjoys the full support and commitment of the Malaysian government, providing a stable, predictable environment for long-term business structures.
Labuan has its own dedicated body of offshore law, including the Labuan Business Activity Tax Act and Labuan Companies Act, providing legal clarity and separation from onshore Malaysian regulations.
Labuan is home to a full range of international and local banks offering multi-currency accounts, trade finance, treasury services and payment facilities for offshore companies.
Compared to Singapore or Hong Kong, the cost of incorporating and maintaining a Labuan company is significantly lower, making it accessible for a wider range of business structures and budgets.
Labuan law includes robust secrecy provisions protecting the confidentiality of client information and business activities, essential for HNWI and family office structures.
Built on a common law foundation and aligned with international standards including FATF and OECD guidelines, Labuan maintains a clean, reputable image in the global financial community.
Situated at the heart of South-East Asia, Labuan offers direct connectivity to the world's fastest-growing economies, making it an ideal hub for businesses operating across the region.
Labuan offers modern physical and digital infrastructure, international flights, and a full range of professional service providers, from banks and law firms to trust companies like ITMC.
Labuan is a small island off the north-west coast of Borneo, Malaysia. Despite its size, it punches well above its weight as a financial centre, largely because of its strategic position within the Asia-Pacific region.
The island is easily accessible from Kuala Lumpur, Singapore, Hong Kong and the major business centres of South-East Asia. It shares its time zone with the region's most important financial markets, making daily business operations seamless for international clients.
For companies with interests in multiple Asian markets, Labuan provides a neutral, well-regarded base that is trusted by counterparties, banks and regulators across the region.
For current legislation, licensing requirements and up-to-date regulatory information, refer directly to the Labuan Financial Services Authority (Labuan FSA), the sole regulator of the Labuan IBFC.
The official website of the Labuan Financial Services Authority. Licensing, news, publications and regulatory updates.
labuanfsa.gov.my ↗The official register of licensed trust companies in Labuan. Verify ITMC Fiduciary Limited under licence number LT0030.
Financial Institutions Directory ↗The principal tax legislation governing Labuan business activities, including the 3% trading income rate and investment holding exemption.
Act 445, Full text ↗The primary legislation governing financial services and securities in Labuan, including trust companies, funds and investment banking.
Act 704, Full text ↗PDF links are provided as a convenience. For the most current versions of all legislation, visit labuanfsa.gov.my directly.
Our team at ITMC Fiduciary has been guiding clients through Labuan structures since 2003. Speak to us. No obligation, complete discretion.