Open an LLC in Labuan

To set up an LLC in Labuan one must comply with the registration procedures specified in the Labuan Companies Act 1990. Both Malaysian residents and non-residents have the authorization to open limited liability companies in Labuan. Our team of experts in setting up a company in Labuan can offer professional assistance to everyone interested in starting a business in this region.

Capital requirements to open an LLC in Labuan in 2026

A Labuan limited liability company has a minimum requirement of one share and no specific minimum capital for incorporation.
The minimum number of shareholders for a Labuan offshore company is one and the shareholder can be an individual, a corporation, or a trust company acting as a nominee or in a trustee capacity. Labuan companies have the flexibility to issue shares in currencies other than the Malaysian Ringgit.
For an in-depth introduction to opening an LLC in Labuan and capital requirements, please contact one of our specialists in company formation in Labuan. You can also contact us for information regarding opening a joint-stock company in the country. If you decide to open a company in another country, such as France, we can put you in touch with our local partners. They can help you start a business there in two weeks.

Incorporating a Labuan Limited Liability Company

To open a Labuan limited liability company, you must follow these requirements:

• You must have at least one company secretary from a Labuan Trust Company;
• Have a registered address that is the principal office of a Labuan Trust Company;
• Submit audited financial statements as part of the tax filing requirements;
• Meet the prescribed minimum employee number and annual operating criteria based on the specific activity conducted by the Labuan LLC.

How long does it take to incorporate the LLC?

Additionally, when setting up a Labuan limited liability company, it is important to plan the company’s business structure in compliance with Labuan’s regulations and tax requirements. The time frame for company incorporation is usually 1-2 days, much shorter than in other countries such as Portugal where it may take 2 weeks to open a company.
A company formation specialist in Labuan can provide valuable guidance and ensure that all necessary steps are followed correctly.

Taxes and financial statements for a Labuan LLC

Labuan limited liability companies must conduct an annual audit of their financial statements. The accounts need to be finalized and approved by the Board of Directors no later than March each year.
The corporate tax rate for trading activities is 3% on chargeable income, while non-trading activities like holding investments are exempt from taxation. Intellectual property income is subject to tax under the Income Tax Act 1967. Companies must demonstrate their economic activity to qualify for the 3% corporate tax rate; otherwise, a 24% corporate tax rate may apply.
Labuan LLCs also enjoy tax exemptions, including no indirect taxes, stamp duty exemptions, no exchange control restrictions, and various exemptions for dividends, distributions, withholding tax, and certain payments to non-residents. These tax advantages make Labuan an attractive option for foreign investors seeking favorable tax treatment and business opportunities.

How many companies operate in Labuan?

Additionally, considering the following data and information about Labuan’s financial system, it represents a promising investment destination for those looking to open a company in Labuan:

• There was a total of 4,971 operating companies in Labuan at the end of 2025;
• Out of the total, 2,947 companies are engaged in trading activities;
• Additionally, there are 1,767 non-trading companies established primarily for holding investments;
• The Labuan International Financial Exchange recorded three new conventional listings in 2025, bringing its total to 25 listed instruments (Labuan IBFC Market Report 2025);
• In 2025, assets under management of Labuan fund managers rose by 9.4% to USD 1.2 billion.

Investors who want to open an LLC in Labuan in 2026 should know that there are new regulations applicable starting with the previous year. For instance, the Labuan Business Activity Tax (Amendment) (No. 2) Act 2024 introduces several novelties, some which are very suitable for the business environment.

For instance, under the new laws, companies can now submit their tax return in a longer period of time following the end of the financial year. If, in the past, companies were obligated to report in a period of 3 months, from 2025, their deadline concerning the submission of tax reports was increased at 7 months, a rule which has also been maintained in 2026. Also, starting with 2025, shipping activities are no longer assimilated to the definition of “trading activities” and this will have a major impact on their taxation.

Please mind that 2026 introduces new rules concerning the submission of tax documentation in an electronic format. Thus, it must be noted that taxpayers with annual revenue between RM 3 million and RM 5 million (phase 4, from 1 January 2026; larger businesses were already covered) are required to complete their tax obligations through the eInvoice system. Those who have less than RM 3 million in revenues (threshold raised from RM 1 million on 1 September 2026) are exempt from the digital submission obligations.

Starting with 1st of January 2026, the local authorities have implemented several tax exemptions – for instance, cars imported into Labuan that have a value of less than RM 300,000 are exempted from the payment of the excise duty, import duty and the sales tax. Construction contracts signed up until July 2027 also benefit from an exemption on the payment of the sales tax.

For expert guidance and assistance in setting up a Labuan LLC, we recommend contacting our experienced team of company formation specialists in Labuan. Contact us today to explore the opportunities and benefits of starting your business in Labuan.