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Set up an IT Company in Labuan

Updated on Tuesday 25th June 2019

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Set-up-an-IT-Company-in-Labuan.jpgInvestors who set up an IT company in Labuan benefit from an attractive business regime and connectivity to the Malaysian market. The generally favorable regime for running a business is the main reason why investors are interested in opening a Labuan offshore company.
 
IT companies can provide a wide array of services, ranging from software and web development, graphic design, IU and UX design and others.
 
In order to open a company in Labuan, investors will need to follow a list of simple steps, as well as apply for a Labuan Business Visa, as required for their specific purpose (and a Visa for Dependents, when needed). 
 

What are the main steps to open a Labuan IT company?

 
Opening a company in Labuan is a simple process and investors are not required to be present during the entire company formation phase. In fact, our team of agents who specialize in Labuan offshore company formation can handle all of the needed steps, provided that investors offer the documents and the details for the company structure and business activities. 
 
The steps needed to set up an IT company in Labuan are the following:
 
  1. Select the company type: for foreign investors, the preferred business form will be the International Business Company.
  2. Choose the company name: investors need to then choose and reserve the company name, which needs to be unique.
  3. Draw up the documents: the company’s constitutive documents are prepared during this stage and one of our Labuan company formation agents can assist.
  4. Register the business: the newly formed IT company needs to be registered with the Labuan International Business and Financial Centre (IBFC). 
  5. Open a bank account and other steps: after registration, investors can open a bank account as well as obtain special permits and licenses, when needed.
 

What are the taxes for Labuan companies?

 
When they open a company in Labuan, investors benefit from highly attractive taxes. The corporate income tax rate is 3%. Moreover, the Labuan taxation regime is interesting for investors because of the fact that there are very few tax filing requirements and the accounting record are easy to maintain. Moreover, companies incorporated here benefit from the benefits under the double tax agreements signed by Malaysia with other countries.
 

What are the incorporation requirements for an IT company?

 
In general, the requirements for opening a company in Labuan, whether it is an IT company, a trading company or otherwise, are low. For example, a minimum of one shareholder is needed and there are no minimum share capital requirements, however, it is expected that companies will have at least one share, with a common value of 1 USD.
 
The company is also required to have one director and one resident secretary. Company directors and shareholders can also be legal entities. Foreign investors will need to apply for the Labuan work visa, as needed for them and their partners.
 
Secretarial services, as well as virtual office services, are available to those who incorporate companies in Labuan.
 
As far as the registration requirements are concerned, these can depend on the amount of paid-up capital as well as the nature of the business (whether or not it will need to apply for other permits and licenses). Companies are commonly required to pay an annual fee, depending on whether or not they are a Labuan company or a foreign Labuan company.
 

What are some facts about investing in Labuan?

 
Investors in Labuan find a favorable regime for doing business and the location is attractive to trading and non-trading activities alike. According to the IBFC 2018 report, these are the statistics and highlights for company formations:
 
  • 12,5% growth in the number of newly registered companies.
  • there were 1,059 new companies.
  • 3,390 trading companies and 2,024 non-trading companies.
  • • 617 trading and non-trading companies.
  • 60,1% of the companies were from the Asia Pacific Region whole 12.8% from the Far East and 12.1% from Europe.
Investors who are interested in Labuan company formation can contact us for more details about how to open an IT company as well as other types of companies.
 
Quick and easy company formation, low taxation as well as certain privileges related to full foreign ownership are among the main reasons why investors choose to start a business in Labuan.
 
Clients can reach out to us for a consultation on the appropriate business form, more information about the Labuan International Company as well as the taxation regime that will apply to their business. We can also provide services for the formation of a Labuan trust company.

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