Q&A on Annual Compliance for Labuan Companies

KAIZEN啓源

2025-11-10

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Does a Labuan Company need to file financial statements?

Yes. The financial statements are required to be laid before the meeting of members not more than 9 months from the closing of financial year end. The said financial statements shall be circulated to all members not less than 7 days before the date of meeting and shall be lodged with Labuan Financial Services Authority (LFSA) within 1 month from the date of the said meeting of members.

Does a Labuan Company need to pay any renewal fee to LFSA?

Yes. The annual renewal fee is payable to Labuan FSA on or before the anniversary of incorporation.

Are there any economic substance requirements for a Labuan company?

Section 2B(1)(b) of the Labuan Business Activity Tax Act 1990 (“LBATA”) stipulates that Labuan entities must:

maintain a sufficient number of full-time employees in Labuan;
incur an adequate level of annual operating expenditure in Labuan; and/or
demonstrate that management and control are exercised in Labuan.

Does a Labuan Company need to pay corporate tax in Malaysia?

Yes. Labuan companies are required to submit annual tax return with the Malaysian Director General of Inland Revenue by 31 March of that year of assessment.

When does a Labuan company need to file its annual return?

All Labuan companies are required to lodge with LFSA an annual return for each calendar year not later than 30 days prior to the anniversary of its incorporation date.

Kaizen, together with its associate firms in Malaysia, can help the clients to perform these compliances formalities so as to maintain the Malaysia company in good standing. Please call and talk to our professional accountants in Kaizen for further clarification.