Tax Whiz | Labuan Business Activity Tax (Requirements for Labuan Business Activity) Regulations 2021

The Labuan Business Activity Tax (Requirements for Labuan Business Activity) Regulations 2021 (“the 2021 Regulations”) have been gazetted on 22 November 2021 to replace the Labuan Business Activity Tax (Requirements for Labuan Business Activity) Regulations 2018. 

The notable points in the 2021 Regulations are as follows:

1) The expansion of the list of Labuan business activities to include “other trading activity”, as proposed in the Labuan Financial Services Authority’s Circular on Addition to the Revised Substance Regulations dated 21 January 2020.

The other activities covered would be administrative services, accounting services, legal services, backroom processing services, payroll services, talent management services, agency services, insolvency related services and management services other than Labuan company management.

This is deemed to have come into operation on 1 January 2019.

2) The insertion of management and control requirements for a Labuan entity that undertakes pure equity holding activities.  This is in line with the Labuan Investment Committee’s pronouncement 2-2019.

The above is deemed to have come into operation on 1 January 2021.

A copy of the Regulations, Circular and Pronouncement can be accessed via the above links.

Should you have any questions or require further clarification, please do not hesitate to email or contact any of our Executive Directors, Directors, Associate Directors or Managers whom you are accustomed to dealing with or who are responsible for the tax affairs of your organization.

Tai Lai Kok Executive Director Head of Tax

 

Tai Lai Kok Executive Director - Head of Tax and Head of Corporate Tax ltai1@kpmg.com.my + 603 7721 7020	Long Yen Ping Executive Director - Head of Global Mobility Services yenpinglong@kpmg.com.my + 603 7721 7018
Bob Kee Executive Director - Head of Transfer Pricing bkee@kpmg.com.my + 603 7721 7029	Ng Sue Lynn Executive Director - Head of Indirect Tax suelynnng@kpmg.com.my + 603 7721 7271
Soh Lian Seng Executive Director - Head of Tax Dispute Resolution lsoh@kpmg.com.my + 603 7721 7019

Penang Office	Kuching & Miri Office
Evelyn Lee Executive Director - Penang Tax evewflee@kpmg.com.my +604 238 2288 (ext. 312)	Regina Lau Executive Director - Kuching & Miri Tax reglau@kpmg.com.my +6082 268 308 (ext. 2188)
Kota Kinabalu Office	Johor Bahru Office
Titus Tseu Executive Director - Kota Kinabalu Tax titustseu@kpmg.com.my +6088 363 020 (ext. 2822)	Ng Fie Lih Executive Director - Johor Bahru Tax flng@kpmg.com.my +607 266 2213 (ext. 2514)
Ipoh Office
Crystal Chuah Yoke Chin Tax Manager - Ipoh Tax ycchuah@kpmg.com.my +605 253 1188 (ext. 320)