Asia’s Premier International Financial Hub
Qualifying to 
Labuan Corporate Tax Framework
References:
1
Undertake business assessment to determine if the intended business is a qualified Labuan business activity as prescribed under the relevant Economic Substance Requirements (ESR) regulations.

Non-Labuan business activity refers to activities not prescribed under the relevant ESR regulations.
2

Determine the ESR for the intended business to qualify for Labuan tax framework.
3
Undertake ESR-compliant assessment to determine the annual tax treatment.

For a Labuan entity that does not comply with the ESR, the tax treatment for the respective year will be at the rate of 24% upon its chargeable profit. Chargeable profit shall be the net profit as reflected in the audited account.
4

For a Labuan entity that undertakes non-Labuan business activity, the entity will be taxed under the Malaysia Income Tax Act 1967.
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Stay ahead of the game
Access a wealth of information from Labuan IBFC from reports on forward-thinking research to insightful articles.
Get in touch
Interested to setup your business in Labuan? Speak to our dedicated advisors to find out more.
Stay ahead of the game
Access a wealth of information from Labuan IBFC from reports on forward-thinking research to insightful articles.
Get in touch
Interested to setup your business in Labuan? Speak to our dedicated advisors to find out more.
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