Frequently Asked Questions (FAQ) about Labuan Trust company

What is a Labuan trust and what is it used for?
  • A trust is commonly set up and used for different purposes but mainly focuses on managing and protecting people’s assets.
  • Trusts are highly flexible and there are many types to suit one’s unique needs.
Are trusts required to register with Labuan FSA for their set up in Labuan IBFC?
  • While trusts in Labuan do not have to register with Labuan FSA, it must use a Labuan trust company as one of their trustees.
Who can allowed to set up a trust in Labuan?
  • Both Malaysian resident and non-resident can set up a trust in Labuan.
  • For non-residents, Malaysia property can be injected into a Labuan trust.
  • For Malaysian residents, international assets can be placed in to a Labuan trust. As for injection of Malaysian property, Labuan FSA (regulator) approval will be required.
What is the difference between a trust and a foundation?

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How will the income derived from a Labuan trust be taxed?
  • Taxation treatment is similar as other Labuan entities under the Labuan Business Activity Tax Act 1990 (LBATA).
  • Labuan tax treatment
What is the tax implication for Labuan trust's distributions?
  • Distributions from a Labuan trust to its beneficiaries are tax-exempted.
What is legislation governing the operations of a Labuan trust?
  • Labuan Trusts Act 1996
What are the fees payable by a Labuan trust in Labuan IBFC?

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