AMS Trust Company Limited

16/03/2026

10/03/2026

FAQ: Labuan Company & Labuan Partnership

1. When is a Labuan Company generally more suitable?

A Labuan Company is typically suitable where a separate legal entity, centralized management, and clear segregation of liabilities are required. It is commonly used for international trading, holding, and service-based activities.

2. Can foreigners fully own a Labuan Company or Labuan Partnership?

Yes. Both Labuan Companies and Labuan Partnerships may be fully foreign-owned.

3. What banking options are available for a Labuan Company or Labuan Partnership?

Both entities may apply to open accounts with Malaysian domestic banks and Malaysian offshore banks. In addition, Labuan entities are generally permitted to open bank accounts with banks in various jurisdictions worldwide, subject to the respective banks’ requirements and approvals.

4. When is a Labuan Partnership commonly used?

Labuan Partnerships are commonly used for joint ventures, private equity structures, fund-related arrangements, and professional collaborations, where flexible ownership and profit-sharing arrangements are required.

5. What is the tax rate for Labuan Company and Labuan Partnership?

Both entities may enjoy a 3% tax rate on trading activities and a 0% tax rate on investment activities under the Labuan Business Activity Tax Act 1990 (LBATA), subject to compliance with the prescribed economic substance requirements.

02/03/2026

Reminder: Form E Submission

All Labuan entities with or without employees are required to submit Form E to the Inland Revenue Board of Malaysia (IRBM) annually.

Please note that the deadline is 31 March each year.

Timely submission is important to ensure compliance and avoid penalties.

16/02/2026

Wishing a prosperous Chinese New Year to all who celebrate.

May the new year bring success, stability, and continued progress in both business and personal endeavours.

Best wishes from AMS Trust Company Limited.

03/02/2026

Governance of a Labuan Partnership

Effective governance is an important consideration for Labuan Partnerships, particularly where the structure is used for joint ventures, investment activities, or fund-related arrangements.

A Labuan Partnership is expected to maintain clear roles and responsibilities between partners, appropriate decision-making processes, and proper documentation in accordance with the applicable regulatory and statutory requirements.

For Limited Partnerships (LPs), governance typically distinguishes between the management role of the general partner and the rights of limited partners. In a Limited Liability Partnership (LLP), governance arrangements should clearly define management authority while ensuring accountability among partners.

30/01/2026

Warm wishes to all observing Thaipusam, from AMS Trust.

27/01/2026

A Labuan Partnership is established under the Labuan Limited Partnerships and Limited Liability Partnerships Act 2010, providing a flexible structure for conducting business in Labuan.

Labuan Partnerships are commonly used for joint ventures, private equity arrangements, fund-related activities, and professional collaborations, offering flexibility in ownership, management, and profit-sharing arrangements.

Depending on the structure, a Labuan Partnership may be formed as a Limited Partnership (LP) or a Limited Liability Partnership (LLP), each with distinct features in terms of liability, management, and regulatory considerations.

Selecting the appropriate partnership structure is an important step in ensuring compliance and alignment with commercial objectives.

Should you wish to explore whether a Labuan Partnership is suitable for your business or investment structure, we welcome you to reach out for further discussion.

22/01/2026

Governance of a Labuan Company

Strong governance is a key requirement for companies operating under the Labuan regulatory framework. A Labuan company is expected to maintain appropriate oversight, decision-making processes, and internal controls that are commensurate with its business activities.

Governance obligations include ensuring proper board and management oversight, adherence to regulatory and reporting requirements, and compliance with applicable economic substance requirements to enjoy Labuan preferential tax.

Effective governance not only supports regulatory compliance but also enhances credibility with regulators, financial institutions, and counterparties.

20/01/2026

A Labuan company is incorporated under the Labuan Companies Act 1990 and regulated by the Labuan Financial Services Authority (Labuan FSA). It is commonly used to support international business activities, including holding, trading, and service-based operations.

Labuan companies offer flexibility in ownership and operations, with 100% foreign ownership permitted, and may benefit from preferential tax treatment under the Labuan Business Activity Tax Act 1990 (LBATA), subject to meeting the applicable economic substance requirements.

Depending on the nature of activities, a Labuan company may be structured as a trading, service-based, or holding entity, each with its own regulatory and tax considerations.

For further information on suitability and structuring considerations, feel free to reach out to us.

15/01/2026

We are pleased to share that the AMS Trust's website has been enhanced.

The updated website is designed to improve clarity, accessibility, and navigation, providing a more streamlined experience for clients and stakeholders seeking information on Labuan structures, licences, and wealth management solutions.

We invite you to visit our enhanced website at https://ams-trust.com.my/ to learn more about our services and approach.

For any enquiries or further discussion, please feel free to reach out to us.

13/01/2026

Labuan Business Activity Tax Act 1990 (LBATA)

Labuan entities carrying on Labuan business activities are subject to the LBATA, which provides a clear and structured tax framework for international operations.

Under LBATA, trading business activities may be taxed at 3% on audited net profits, subject to compliance with the applicable economic substance requirements.

Non-trading business activities may qualify for a 0% tax rate on the net profits, likewise subject to meeting the relevant substance requirements.

A proper understanding of the scope and application of LBATA is an important consideration when structuring Labuan entities for international business.

To learn how your business may be structured to benefit from the preferential tax treatment under LBATA, appointments may be arranged with our team.