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Pros and cons of Labuan company formation

Apr 27, 2017

Talking about jurisdictions, offshore company in Malaysia is not a regular decision. This is why we decided to explain how to set up a company in Malaysia and figure out why is it rational to set up your business in Labuan. Registration and incorporation of offshore company in Labuan is requires standard actions like collecting and filing documents but still there are some interesting factors you, as entrepreneur, should know about.

Labuan International Company is the most popular business structure when you decide to create an offshore company in Malaysia. This jurisdiction grants low taxes for international business. For example, company’s paid-up capital is limited to 1$ and you can also enjoy advantages of paying only 3% or fixed amount of profit tax per year. Setting up a business in Malaysia can also be profitable for investment companies as it can act without separate property, assets and wealth management. This means that doing business in Malaysia can grant your company favorable conditions for growth and development.

First of all, you need to collect, and submit all needed documents. Standard documents for international offshore company in Labuan are identification of directors, the memorandum and articles of association. Registering a company in Malaysia is not a long process: in most situations, it takes up to five working days but if you have inaccuracies in documentation, it might take a longer time.

Most common fears of entrepreneurs while setting up a business in Malaysia are number and residency of shareholders and directors as well as requirements about starting capital and physical operating office. These factors are not deciding for Labuan offshore companies because minimal number of shareholders and directors is only one, you do not need to be Malaysian resident and you can also list legal entity as director or shareholder.

After you register company in Malaysia there are other things to be considered before starting business completely.

Directors and shareholders’ meetings can be held all over the world but marketing office is limited to allowed cities. It is important to check the list before renting a suitable office. Good news is that when establishing company in Malaysia you can enjoy confidentiality laws that grant your information safety from public access.

One more thing you need to consider when you establish company in Malaysia is that you need to obtain work and entry visas to perform business activities in this jurisdiction. It is not a complicated process and it is also common to obtain visas for the whole family.

What can we say about opening bank account and operating it in Labuan?

There is a wide choice of trustworthy banks and, if needed, trust agents who will operate your banking account professionally. You are always free to use onshore as well as offshore bank accounts in process of Malaysia business registration. Banks do not usually require a pile of documents and information. It is easy to use all features, including currency exchange, internet banking and international account integration. Sometimes you will need help of professional consultant to check your banking history, avoid any reputation issues and make sure you will easily open bank account while registering offshore Malaysia Company.

Doing business is not only about registration but also it requires full operation process from entrepreneur.

Malaysia offshore company and its managers are allowed to employ not only foreigners but also Malaysia residents. Moreover, you have privileges to lower your social package payments and deal directly with employees unlike native employers. Domestic business company in Malaysia is required to follow a lot of unnecessary rules and you, using Malaysia offshore company advantages, can plan your expenses, develop business and function in the most effective way.

OffshoreLicense Ltd. is ready to assist you with any stages of company set-up in Malaysia. When you are done with all formalities it is easy and tempting, to give most attention to development. However, do not forget to pay annual fee and check whether government has no claims to your business. Offshore jurisdiction of Malaysia and specifically Labuan is a great choice for growing business and investors so do not hesitate to start your company in this country!

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