An LLP differs significantly from an LP in that it essentially combines the features of a partnership and a corporation. LLP has the business flexibility and tax benefits of a partnership but resembles a private company in other respects.

It is comprised of Members, each of whom benefit from limited liability; members of an LLP are protected from many potential negative consequences of the actions of other partners.

Limited liability protects members of an LLP from personal liability for business debts, employee claims and public liability claims.

Other features and advantages of an LLP:

  • Profit sharing plans and other arrangements can be agreed flexibly between partners and changed as required
  • The partnership makes an annual return but members retain self-employed status and report their share of profit on their personal tax return
  • Perpetual succession applies, an important factor for the stable ongoing development of the business
  • As a separate legal entity, the LLP can enter into contracts and sue (or be sued) without the need for partners to be exposed personally.

As a result, LLPs offer an appealing option for many looking to structure a business operation in a tax efficient manner with minimal personal risk.

Section 34 of the Act allows a LP to be converted into an LLP, while Section 35 allows a Labuan Company to transition to an LLP.

There is no limit to the number of partners in an LLP.

Features of Labuan LLP

Labuan  LLP

Corporate Details

General

  • Type of Entity

LLP

  • Registered Office in Labuan

Yes

  • Shelf company availability

No

  • Our time to establish a new company

4 weeks

  • Corporate Taxation

Yes

  • Access to Double Taxation Treaties

No

Share capital or equivalent

  • Standard currency

US$

  • Permitted currencies

EUR, USD, GBP

  • Minimum paid up

None

No

  • No-par-value shares allowed

No

Directors

  • Minimum number

Two

  • Local required

No

  • Publicly accessible records

Yes

  • Location of meetings

Anywhere

  • Corporate directorship allowed

No

Shareholders

  • Minimum number

Two

  • Publicly accessible records

Yes

  • Corporate shareholders allowed

Yes

  • Location of meetings

Anywhere

Company Secretary

  • Required

No

  • Local or qualified

No

Accounts

  • Requirements to prepare

Yes

  • Audit requirements

No

  • Requirements to file accounts

Yes

  • Publicly accessible accounts

Yes

Other

  • Requirement to file annual return

Yes

  • Migration of domicile permitted

Yes

Labuan LLP Distinctive Benefits

  • Reduced tax burden for the business: The members of the partnership are defined as self-employed, which means that the only tax to pay is income tax as normal on their share of the profits. There is no corporation tax or capital gains to consider.
  • Asset protection and estate planning tool: assets cannot be touched by creditors or any other claimant, and costly inheritance tax can be avoided through the use of a partnership model.
  • Effective vehicle for professional practices, joint ventures, special purpose projects and more.

The Valsen Advantage

  1. Speedy, Efficient and consistent Services.
  2. Relentless effort to obtain bank accounts.
  3. Expert advice on structuring options.
  4. Dedicated ongoing compliance support.