| Labuan trust company |
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Trust Labuan Tax Inc is a licensed trust company in Labuan to provide company secretarial services from company formation, bank account opening, work permit application, and Labuan licensing application |
| Labuan company |
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A company incorporated at Labuan international business financial center. Considered non resident in Malaysia |
| Labuan |
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A low tax jurisdiction located in Malaysia, either subject to zero tax or 3% tax |
| Withholding tax |
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A tax rate that is withheld during fund transfer out of Labuan. Withholding tax rate is usually lower, if there is a double taxation agreement signed between Malaysia and intended countries |
| Paid up capital |
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The amount of share capital fully paid up into the Labuan company |
| Source of income |
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Jurisdiction where income is mainly earned from. Eg, Foreign income source (overseas) / domestic income source (Malaysia) |
| Management and control |
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Jurisdiction where core business activities are mainly performed and decisions are made |
| Labuan non trading activities |
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Labuan non trading activity is consisted of pure equity holding, and non pure equity holding |
| Non trading - Pure equity holding |
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Labuan pure equity is holding the shares of a subsidiary company |
| Non trading - Non pure equity holding |
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Labuan non-pure equity is holding investments, other than shares of a subsidiary company. Eg, securities, stocks, bonds, debts |
| Labuan business activities |
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Labuan company that conducts licensed business activities, or activities that are subject to Malaysian local tax (ITA Act) |
| Holding company |
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A Labuan company that buys (holds) shares of another company (subsidiary), or holds long term investments that generate passive income. Eg, securities, stocks, bonds, debts |
| Audit in Labuan |
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Labuan company must be audited (and must appoint an auditor), except for non-trading activities conducted |
| Sdn Bhd |
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Sendirian Berhad, Private Limited in Malaysia - A Malaysian local company |
| Jurisdiction |
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Jurisdiction here refers to Labuan, Malaysia |
| Offshore |
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Offshore company here refers to company formation at countries like Singapore, Hong Kong, UK, BVI, Cayman, Seychelles |
| Malaysian resident |
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Malaysian citizen, permanent resident or foreigners that stays more than 183 days in Malaysia |
| Foreigner |
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Non Malaysian resident that stays less than 183 days in Malaysia |
| Work permit |
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A legal permit that allows foreigners to work and reside in Malaysia. Sometimes also called Employment Pass / Expatriate Work Pass |
| Dependent visa |
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Visa for work permit holder's spouse, children or parents to stay in Malaysia |
| Labuan IBFC |
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Labuan International Business and Financial Centre. A marketing arm that promotes Labuan's benefits |
| LBATA 1990 |
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Labuan Business Activity Tax Act 1990 - Labuan corporate tax (3% tax if substance are fulfilled, 24% tax if substance are not fulfilled) |
| ITA Act |
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Income Tax Act 1967 - 24% corporate tax, if source of income is derived from Malaysia |
| DTA / DTAs |
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Double Taxation Agreement is an agreement between two countries seeking to avoid double taxation |
| LCA |
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Labuan Companies Act 1990 (Act 441) - The Act that governs Labuan companies and its business activities |
| OECD |
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Organisation for Economic Co-operation and Development - International organisation that consists of members from several countries |
