Latest Information

New Year’s holiday schedule 2021/2022

Dear Valued Clients,

Thank you for your continued business.

December is already entered in mid-term, our New Year’s holiday schedule 2021/2022 are as follows:-

Dec. 26, 2021Dec. 27, 2021Dec. 28, 2021Dec. 29, 2021Dec. 30, 2021Dec. 31, 2021Jan. 1, 2022Jan. 2, 2022Jan. 3, 2022Jan. 4, 2022Jan. 5, 2022
Closed11:00

18:00

11:00

18:00

11:00

15:00

11:00

15:00

ClosedClosedClosedClosed11:00

15:00

11:00

18:00

[Requests from existing clients]

For clients who have already used our service and have received payment confirmation, we will respond until the last business day of the year 2019. December 31 (Friday) is the last business day for banking and administrative relations, and the beginning of the year 2021 is informed that it will start business from January 3 (Monday).

Priority S: Clients whose payment has been confirmed
Priority A: Clients whose payment has not been confirmed

***

[Requests from new clients]

Inquiries from new clients will be handled sequentially, but in order to respond to existing customers with priority, it may take some time to reply.

In addition, the case that needs to be processed by the end of this year 2021 was held on Dec. 17 (Friday), and new applications were suspended. You can consult with us and accept new requests, but kindly note that in principle it will be handled after next year 2022.

Priority B: Depends on the project … New contract, etc.
Priority C: General consultation

  • Our policy is to prioritise support for our existing clients.

***

For clients who contact us via the inquiry form on the website during the year-end and New Year holidays, we will respond to you as soon as the new year’s business resumes.

This year is about to end, thank you for your understanding and continued warmly support in 2022.

Best Regards,
Support Team

Labuan

[Very Important Notice] To clients who are planning to apply ESR on YA2021 (Reply deadline 9th DEC. 18:00 GMT+8:00)

Dear Valued Clients,

Good day, this is Bona Trust Support team. As the title mentioned above, we sent an email to all clients today, so kindly check it.

***

Our client companies who are planning to introduce retroactive application of ESR should put your company name in the title of this e-mail so that it can be identified, and write the following contents and reply to this e-mail. Once we collect aggregated data on how much business property and personnel need to be secured for all of our clients. We will contact you individually case by case.

Kindly include the following 4 contents in the reply email: –

◇ Company Name: <Your company name>

◇ Business Nature: <Attributes of your company’s business content>

◇ Commencement of Business Date: <Your company’s business start date (by retroactive application)> [*1]

◇ Estimated Sales: Estimated annual sales (if the business starts in the middle of the year, the total estimated amount for the month)

* 1 According to our management information, client companies that met the ESR requirements in 2019 will also meet in 2020. And many client companies are in the process of dismissing their hiring staff in Q1 2021. Therefore, if you apply to this case, kindly enter Apr 2021, which is Q2, as the start date, and if you are new to start ESR from 2021, kindly enter it from January. If you start your business in the middle of the fiscal year and meet the ESR requirements, start from the month in which sales occur.

* Clients who wish to apply from November 2021 or January 2022 will respond after next week (unless there is already a prior contract). Kindly note that as the end of the year is approaching, we will give top priority to the support of existing clients.

◇ What is included in the support

1. Securing the desired number of staff of 2 or more in Labuan
2. Securing business management office properties and arranging property agreement in Labuan
3. Employment registration, payroll calculation and payroll agency for each staff member
4. Each staff member joins the SOCSO and pays insurance premiums on their behalf
5. Storage of various documents generated in 1-4, submission to the auditor on behalf, etc.

Thank you.

Best Regards,
Support Team

[Very Important Noice] Labuan Business Activity Tax (Requirements for Labuan Business Activity) Regulations 2021 [P.U. (A) 423 /2021]

Dear Valued Clients,

Good day, this is Bona Trust support team.

As the title mentioned above, Labuan FSA is pleased to inform that a Circular on Labuan Business Activity Tax (Requirements for Labuan Business Activity) Regulations 2021 [P.U. (A) 423 /2021]. This notice was sent to the Association of Labuan Trust Companies on the evening of November 23, last night, and we will make an official notice to all our clients here.

The circular stipulates the treatment of substance requirement for “other trading entity”.

Labuan general trading company will be eligible for a 3% tax incentive if you can meet certain substantive requirements.

Bona Trust Corporation image

[Summary]

(1) These regulations may be cited as the Labuan Business Activity Tax (Requirements for Labuan Business Activity) Regulations 2021.

(2) Except for regulation 3, these Regulations are deemed to have come into operation on 1 January 2019.

(3) Regulation 3 is deemed to have come into operation on 1 January 2021.
Requirements for Labuan business activity.

***

◇ The matter and the following circulars issued by LFSA.

1. Addition to the Revised Substance Regulations dated 21 January 2020

2. Labuan Business Activity Tax (Exemption) Order 2020 dated 5 June 2020

***

◇ Ministry of Finance issued LBATA Regulations 2021, the key highlighted is : –

a) meeting of the board of directors is convened in Labuan at least once a year

b) the registered office in Labuan entity shall situated in Labuan

c) the secretary of Labuan entity appointed under the Labuan Company Act. 1990 [Act 441] shall be resident in Labuan

d) the accounting and business records shall be kept in Labuan

***

◇ Inclusion of The Other Trading Entity under item 20 as follows: –

[Very Important Notice] Labuan’s Economic Substance Requirements
The substantive requirements for applying Labuan’s tax incentives are as follows: –

Economic Substance Requirements introduced by Labuan
1. Employ at least 2 local staff (one of whom is a manager and has the authority to make company decisions)
2. The annual contribution cost on Labuan Island must be RM50,000 or more (including the annual company secretary expenses, office expenses, and salary payment to staff, etc.)

* If the above requirements cannot be met, the mainland Malaysia tax rate (24%) will be applied.

* When conducting business activities using a Labuan corporation, the minimum annual maintenance cost is [annual contribution cost (RM50,000 or more) + effective tax rate 3%].

* The effective date for P.U.(A) 423/2021 is from 1 January 2019 exept conditions in relation to control and management in Labuan which is deemed to have come into operation on 1 January 2021.

* With issuance of P.U.(A) 423/2021, the Labuan Business Activity Tax (Requirements for Labuan Business Activity) Regulations 2018 [P.U.(A) 392/2018] is revoked.

◇ PUA423 Final

Requirement

Tax incentives are applicable to businesses with the above attributes.

Ref: – Kindly refer to PUA 423 for in detail.

***

Although the roughly direction has been decided as described above, the points that have not been clarified at this point are as follows, and it is not a problem that can be solved simply, such as 3% being applied immediately.

1. If it is applied from 2021, it will be applicable if the ESR (Economic Substance Requirements) is met by the middle of 2020.

2. If it is applied from 2021, it will be applicable if the ESR (Economic Substance Requirements) is not met by the middle of 2021 and the requirements are met toward the end of the year.

3. If the ongoing JR (Jurisdiction Review) wins on Taxpayer side, can the client company participating in the JR claim the attorney’s fees paid as a cost to the government?

4. Will it be able to get a refund if the clients pay an additional 21% difference gap (24% -3%) even though they met the requirements in 2019 and 2020?

5. Is it possible to realise flexible operation of LBATA by exempting complicated processing such as when the tax system of ITA (Act.1967) has already been agreed and the operation of COP204 has started?

6. Is there an alternative way to hold a board meeting, such as by conference call, if it is physically impossible to travel to Labuan? (* Currently, Malaysia is not allowed foreigner to enter due to lockdown, so if director do not have a valid visa, they will not be able to enter Malaysia). Or, as another alternative way, is it possible to have one resident director, at least 1 person in Labuan, and other directors from abroad?

Since the outline and direction have not been decided completely yet, we Bona Trust will investigate the practical operation at as soon as possible and share it with every clients. If there is any progress, we will notify all clients by e-mail at the same time, so kindly check the e-mail from us regularly and make preparations so that we can respond promptly.

***

Thank you for Labuaning with us.

Best regards,
Support Team

[* Ref] History by time series
December 2018:

The Labuan Business Activity Tax Law (LBATA 2018) was amended, and the maximum tax rate of RM20,000 was abolished. As a result, the corporate tax was changed to 3% uniformly

(* Offshore countries and regions around the world consulted individually with the OECD, and Labuan also agreed to a major revision of the tax system in order to aim for whitelisting as a measure against harmful taxation. To enjoy for tax incentives, Labuan companies are required to meet the requirements of Economic Substance Requirement (ESR)).

January 2019:

Guidelines for amending the Labuan Business Activity Tax Act (LBATA 2018) have been promulgated, and guidelines for applying 3% taxation for each license have been published. At this time, OTC (Other Trading Company) was not included in the designated list.

November 2019:

Held a joint meeting between the Association of Labuan Trust Companies (ALTC) and the Labuan Financial Services Authority (LFSA). As the Other Trading Company (OTC) is not included in the designated list that meets the Economic Substantial Requirements (ESR), the Association of Labuan Trust Companies (ALTC) has a common understanding that the tax rate of the Other Trading Company (OTC) will remain the same, as we recognise that 3% would apply. Labuan Financial Services Authority (LFSA) said that the Other Trading Company (OTC) also need Economic Substance Requirements (ESR) to apply 3%.

December 2019:

Each Labuan Trust Company, a member of Association of Labuan Trust Companies (ALTC),  has requested its clients to start preparing for Economic Substance Requirements (ESR) all at once, and hastily completed the application of the requirements by the end of the year.

January 2020:

The Labuan Financial Services Authority (LFSA) has announced that Other Trading Companies (OTC) will be subject to the Labuan tax system, and the Ministry of Finance of Malaysia (MoF) has approved that it will be applied retroactively (retroactively applied) in 2019.

April 2020:

The Inland Revenue Board (IRB) has revised its 2019 corporate tax return form and added the Other Trading Companies (OTC) item to the designated list of business codes subject to the Labuan tax system.

December 2020:

The Other Trading Companies (OTC) entry has been removed from the list of Labuan tax-eligible industries posted on the Internal Revenue Service (IRB) website.

February 2021:

The Inland Revenue Board (IRB) has notified the Association of Labuan Trust Companies (ALTC) that Other Trading Companies (OTC) will retroactively apply the 24% tax system from January , 2019.

March 2021:

Taxpayers side (OTC) who meet the Economic Substance Requirements (ESR) have met proceedings JR (Jurisdiction Review), and are currently in dispute (* Taxpayers who do not meet the ESR file a class action).

November 2021:

From January 2019, the Labuan Financial Services Authority (LFSA) and the Malaysian Ministry of Finance (MoF) have agreed to apply 3% retroactively to Other Trading Company (OTC) that meet the Economic Substantial Requirements (ESR). A notice was sent to the Association of Labuan Trust Companies (ALTC).

 

[Cross-Border Report] About movement between Kuala Lumpur – Labuan

Dear Valued Clients,

Good day, this is Yudai from Bona Trust Corporation.

As the title mentioned above, I will post a report on cross-border movement between Kuala Lumpur and Labuan under movement control order.

***

[What to prepare before traveling]

Create an application for cross-border permit.

About obtaining a cross-border permit from the Malaysian police

Perform PCR test 2 days before.

Pay in advance and walk in in about 5 minutes.

Ref: DOCTOR 2U  (There are so many clinics conducting such tests around Kuala Lumpur)

Obtain a negative PCR test [1] the day before.

Kindly print out the negative proof of the email (Results will be emailed to you on the day at the earliest).

Take [1] to the police station in your jurisdiction and get the police signature.

Bring the following documents with you when visiting the police.

1. Original passport

2. Documents that can prove the reason for traveling to Labuan (such as immigration reservation documents for obtaining workling permit)

3. Ticket reservation table (print the ticket if already checked in)

4. PCR test negative certificate

5. Passport face page copy

6. Visa page copy (only for renewal case)

and,

7. Cross-border permit application

Kindly Note: When visiting public institutions such as the police, kindly wear long pants and long sleeves with less exposed skin. In some cases you will be asked to change clothes.

Obtain a cross-border permit (2.3.4.5.6. is closed with a file in the document of 7.).

[Documents required for cross-border movement]

1. Passport

2. Negative certificate of PCR test

3. Cross-border permit (Malaysian police)

On the day, go to the airport (Terminal 1). * Because there are procedures, I recommend you go early to airport.

 

Labuan

As soon as you enter the airport, you will be asked to confirm your cross-border permit and PCR negative certificate (Twice in total when passing through the airport entrance and restricted area).

Labuan

Move inside the airport.

Labuan

Currently, a cross-border permit is required for all transfers except Langkawi (Oct. 1, 2021).

Labuan

Currently, only Malaysia Airlines operates between Kuala Lumpur and Labuan. AirAsia is out of service.

* For Business Class passengers: The lounge is closed.

Labuan

There is currently only 1 cafe where you can eat light meals. I recommend that you bring water from your house or hotel.

Labuan

Flight safely.

Labuan

Flying on the South China Sea. It takes about 2 hours and 20 minutes to Labuan island.

Labuan

Arrive at Labuan.

Labuan

After passing the immigration, take the escalator down to the ground level.

I could not take a photo from here, but I will confirm the vaccination on the ground floor.

X: <If> 14 days after the 2nd dose vaccination, <Then> You can leave the airport as it is.

Y: <If> less than 14 days have passed since the 2nd dose vaccination, <Then> MOH (Ministry of Health) staff will arrange for an quarantine hotel. ⇒ Head to the hotel.

Z: <If> not vaccinated, <Then> Same as Y.

Labuan

Please come to the front entrance on the ground level of the financial park according to the reservation date and visit time. From here, our staff will escort you to the immigration.

Kindly Note: Currently, the Labuan Immigration Department is in a difficult situation for reservation. Due to the limited number of people entering each day, you must adhere to the reserved time. Therefore, kindly visit on time.

Labuan

If you arrive at the Labuan Immigration Department and are going through visa-related procedures, this is your goal.

Currently, all visa issuance payments can only be made with Mastercard. Since cash and cards issued overseas cannot be used, we will make an advance payment (if any).

Labuan -Returning to Kuala Lumpur does not require a PCR test so far, but a cross-border permit is required.

Kindly go to the Labuan police the day before you return. Bring the following documents with you when visiting the police.

1. Cross-border permit obtained in Kuala Lumpur

2. Ticket reservation table (print the ticket if checked in)

Obtain a cross-border permit

Kindly Note: Currently, there are cases where visa issuance is not completed in 2 business days, and there are some cases where the return ticket must be redeemed. If possible, I recommend purchasing a ticket that allows you to change the date.

***

【postscript】

For all new clients who have signed a agreement for a business property in Labuan, we have completed the installation of signboards.

Labuan

That’s all, I hope it will be helpful when you travel.

Thank you.

About obtaining a cross-border permit from the Malaysian police

Dear valued Clients,

To the client who has already obtained approval letter for new Work Permit acquisition or renewal, and will share information with whom waiting in West Malaysia planning to travel to Labuan for visa related purpuse.

Currently, in Malaysia, it is obligatory to obtain a cross-border permit from the police before movement between states. In this post, we will explain how to obtain a cross-border permit from Malaysian police.

***

The following information is required to obtain a cross-border permit.

1. Details of the applicant

1. Name
2. Malaysia National ID (if Malaysian)
3. Nationality
4. Passport No.
5. Residential Address
6. Phone No.
7. Email Address
8. Transportation
9. Number of Passengers
10. Departure Date
11. Return Date (Leave blanked)
12. Destination

2. Purpose of Apply

Describe other information such as visa acquisition, companions, etc.

Kindly download the form from [Sample] Surat-PKP – EN and fill it out (both MCO and EMCO can apply in the MCO form).

We have prepared a completed image, so please download it from [Draft] Surat-PKP EN and refer to it as well.

* Sample draft image is as follows: –

Malayssia Police Certificate draft image

***

[What to bring when visiting the police Station]

・ Application form * 2 copies (completed and signed documents)
・ Accommodation hotel reservation email * 1 copy (or booking slip)
・ Air ticket * 1 copy (or booking slip)
・ Approval letter from Labuan FSA * 1 copy
・ Appointment letter from Labuan Immigration * 1 copy
・ Passport copy (face photo page) * 1 copy
・ Visa page * 1 copy (Please print out the appointment letter from Labuan immingration and bring it if it is not obtained yet) * 1 copy
・ Original passport
・ Blank application form (as a backup in case of an entry error) * 2 copies
+
・ Spouse or dependents passport copy (face photo page) * 1 copy (When accompanying to Labuan)

Note 1 : Applications cannot be issued on the same day, so kindly apply by the day before the scheduled move date at the latest.

Note 2 :  When moving, kindly take a PCR test and obtain a negative certificate at least 3 days before your departure.

* Unless deregulation is announced, these provisions are expected to continue until the movement control order is lifted.

***

Thank you.
Support Desk

Launch notice of Support Service for Company Management Business License

Dear Valued Clients,

This is Bona Trust support team. Thank you for your continued support, we Bona Trust would like to thank you all for your warmly support.

As the title mentioned above, we will launch a support service for Company Management Business License acquisition from today.

Company management business provides treasury processing services and such other services as maybe permitted by Labuan Financial Services Authority (Labuan FSA).

In line with Shariah related services, the company management can also provide Islamic advisory services and backroom processing functions. Labuan company management that provides Islamic company management services must engage a Shariah Advisory Panel to advise on its operations.

Kindly refer to the link below for details,
Thank you.
Support team

* From the viewpoint of maintenance costs, this service is intended for client companies with pre-tax profit of approximately USD 500,000 / year or more as the main customer target.

Labuan Company Management Business License

About Labuan Business Activity Tax (Requirements For Labuan Business Activity) Regulations 2018 (Amendment) Regulations 2020

Dear Valued Clients,

Good day, this is Bona Trust support team.

Based on the latest P.U.A (375) dated 24 December, 2020 on Labuan Business Activity Tax (Requirements for Labuan Business Activity) Regulations 2018 (Amendment) Regulations 2020 (“the Amendment Regulations”), other trading activities under Code 23 of List of Codes and Types of Business Activity are not listed as part of the Amendment Regulations.

As such, Labuan Entity carrying other trading activities will not be deemed as Labuan Business Activity and will be subjected to tax under Income Tax Act 1967 (ITA) for year of assessment 2021 irrespective whether they comply with the Economic Substance Requirements or not.

However, the Association of Labuan Trust Companies together with the Labuan Corporation, the municipal government have sent an appeal to Ministry of Finance (“MoF”) to re-instate the business of general trading, provision of services and other non-listed activities to be taxed under Labuan Business Activity Tax Act 1990 (LBATA).

As of now, we are yet to receive any updates on the appeal submitted to MoF therefore, a Labuan Entity conducting other trading activities are not listed in the Amendment Regulations will remain status quo at this present moment. We will continue to update you when information becomes available.

While waiting on the appeal status, please do not hesitate to contact us if you wish to explore other alternative solutions; or if your Labuan Entity is carrying out any of the 22 types of business activity listed under the Amendment Regulations and you require assistance or guidance to meet the requirements.

Thank you.

Best Regards,
Support Team

* P.U.A is gazetted order. PU order is a piece of subsidiary legislation that has passed through parliament and has the force of law. PU stands for “Pemberitahu Undangan” or “Legal Notification”.

New Year’s holiday schedule 2020/2021

Dear Valued Clients,

Thank you for your continued business.

Our New Year’s holiday schedule 2020/2021 are as follows:-

Dec. 26, 2020Dec. 27, 2020Dec. 28, 2020Dec. 29, 2020Dec. 30, 2020Dec. 31, 2020Jan. 1, 2021Jan. 2, 2021Jan. 3, 2021Jan. 4, 2021Jan. 5, 2021
ClosedClosed11:00

18:00

11:00

15:00

ClosedClosedClosedClosedClosed11:00

15:00

11:00

18:00

[Requests from existing clients]

For clients who have already used our service and have received payment confirmation, we will respond until the last business day of the year 2019. December 30 (Wednesday) is the last business day for banking and administrative relations, and the beginning of the year 2021 is informed that it will start business from January 4 (Monday).

[Requests from new clients]

Inquiries from new clients will be handled sequentially, but in order to respond to existing customers with priority, it may take some time to reply.

In addition, the case that needs to be processed by the end of this year 2020 was held on Dec. 15 (Tuesday), and new applications were suspended. You can consult with us and accept new requests, but kindly note that in principle it will be handled after next year 2021.

***

For clients who contact us via the inquiry form on the website during the year-end and New Year holidays, we will respond to you as soon as the new year’s business resumes.

December is already entered in mid-term, and this year is about to end. This year 2020 was a year with so many accidents and events due to the influence of the coronavirus (COVID-19) that has involved the world since the New Year.

Thank you for your understanding and continued warm support in 2021.

Best Regards,
Support Team

Important notice regarding change of work permit obtain and renewal rules

Dear Valued Clients,

We will inform all clients from Bona Trust support team.
Currently, the Labuan Immigration has made the following visa-related rule changes: –

1. Currently, the Immigration does not accept translations from third parties, only ITMB translations.

The ITBM translation service is available from the following sites.
https://www.itbm.com.my/en/servis/terjemahan

2. The translated educational certificate and family register must be certified by the Embassy of the country in which you have nationality.

Clients who are currently receiving new work permit applications and renewal approval notices from us should bring your educational certificate and the original copy of your family register to the Embassy of the country in which you have nationality.
https://en.wikipedia.org/wiki/List_of_embassies_in_Kuala_Lumpur

∟ 2-1. Certificate of Education
Must be the original English certificate from the school seal stamped on it. The embassy will certify.

∟ 2-2. Family register original copy (For Dependent Pass)
The English translation of the family register must be the original and the English-translated documents requested by ITMB. The embassy will certify.

3. The passport-sized ID photo used for the visa sticker must have a blue background (currently, white background photos are not available).

Previously, visa stickers were only valid for photos with a white background, but now only those with a blue background are valid.

***

If you do not meet the above document requirements, you will not be able to renew or obtain work permit, so kindly prepare in advance before you visit Labuan.

Thank you.
Support Team