Malaysia, a country in Southeast Asia is particularly popular as an offshore jurisdiction in all of Asia among wealthy foreign investors and entrepreneurs because of the various benefits the country provided towards foreign investors. The country over the years has gained traction as an international financial centre. With the stable political environment and a strong economy, the country also maintains strong ties with other major rich nations like the U.S and Japan.
Offshoring has gained quite a popularity as the years go by. Offshoring simply means changing the jurisdiction of your business other than your home country into a foreign jurisdiction. Ever since the end of world war II from the early 1950s, the offshoring business has grown astronomically and today, it is estimated that the industry is approximately worth over $5 trillion.
There are various reasons why the offshoring business has skyrocketed, most of which is credited to the wave of globalization through fast transportation and connected world using the internet. The advent of the internet also has served tremendously in the growth of offshoring business. With the advancement in technology year after year, the sky's the only limit for offshore businesses.
During such fast times, having an offshore company is a golden ticket towards safety, growth and freedom. And it almost goes without saying that if you have an offshore company, you are to have an offshore account too. These offshore jurisdictions provide you a lot of benefits some of which are stated below.
Benefits Of Having An Offshore Company With An Offshore Account
- Low or Zero taxes
- Asset protection
- Financial privacy and confidentiality
- Financial freedom
- Ease of doing business
- International trading
- Political diversification
Now, various of these offshore jurisdictions are designed to attend to various needs of foreign investors. So, choosing the offshore jurisdiction entirely depends upon what the individual or the corporation is looking for. And making this decision should be taken seriously because opening an offshore company or an account is generally not cheap although it varies from jurisdiction to jurisdiction. We recommend you consult a financial expert or an advisor in doing so.
Now, as I’ve stated earlier that Malaysia is a favorable offshore jurisdiction for many foreign investors, one specific jurisdiction called Labuan shines greater in all of Asia as a leading financial hub of the world. Let’s go through some of the benefits this Asian jurisdiction has to provide for foreign investors.
Benefits Of Having An Offshore Company With An Offshore Account In Labuan, Malaysia
- Fast and Low incorporation cost: Incorporating an offshore company takes about 1-7 days in this jurisdiction. Also the incorporation cost is so relatively low than almost any other jurisdiction in the world.
- Low annual licensing fees: licensing fees in the region is also very low which is roughly half the cost of that of Singapore.
- Doing business in the region has also been made so simpler that there are no trade license requirements for most businesses
- 100% foreign ownership: You can open an offshore company in Malaysia and total ownership by foreigners of the company is totally possible
- Minimum of one shareholder and director requirement: Labuan in Malaysia is one of those very rare offshore jurisdictions where one can simply establish an offshore company with just one shareholder or a director. So, you literally can single handedly own an entire company and you won’t need to take the help of a local Malaysian person to open your offshore company.
- Labuan being an international financial hub allows you the opportunity to trade in various international currencies.
- Ideal location: Malaysia is a Muslim country and this provides the easeness of doing businesses across Middle east markets and all of Asian markets too.
- No inheritance or estate duties: This benefit that you can safely inherit all your wealth without paying any taxes is also a great motivating factor for the rich to bring their wealth to the jurisdiction.
- Zero taxes for non-trading companies: non trading companies like service and investment firms enjoy the benefit of zero taxation here in this jurisdiction.
- Low taxes for trading companies: corporations are taxed at a very low rate of just 3% on the company’s annual profit or alternatively they can opt to pay a fixed amount of $7400 per year as tax.
- Minimum requirement of paid-up capital: In Labuan you can literally start a company with a paid-up capital of just $1 USD. This enables a lot of small businesses to start up their company easily.
- Security and confidentiality: if you open an offshore company in Malaysia, you can rest assured that your financial information is kept private and confidential.
- No disclosure of shareholders or directors: the information of who the shareholders and directors are of an offshore company are well hidden from public records. And trying to breach this security without authorization will result in a large penalty.
So, opening an offshoring business in Malaysia is indeed cheaper, easier, convenient, faster and safer in a lot of ways. Therefore, if you have in mind of starting an offshore business in Labuan, Malaysia or any other offshore jurisdiction you might wanna choose, we at Business setup worldwide can help you with all the process and have your offshore company set up with no hassle. Feel free to contact us anytime. We’d be happy to help out our clients in realizing their financial dreams.
What are the issues with the offshore company in Malaysia?
High registration fee in US dollars.
Cannot conduct business in Malaysia's peninsula or the state of Labuan.
In Peninsular Malaysia, directors cannot live or obtain a business visa.
When did the offshore registration law come into effect in Malaysia?
Jan 1, 2019.
In Malaysia, is offshore banking permitted?
But it's vital to remember that having an offshore account is not against the law for Malaysians. Most financial institutions already follow strict anti-money laundering and KYC (know your client) rules.
Can I take money out of my account abroad?
You may easily access your money anywhere globally with a debit card. The card's usage costs might pile up. Larger cash withdrawals may reduce these expenses. Some banks abroad provide checks.