Director General of Inland Revenue clarifies definitions of Labuan trading and non-trading activities

26 March 2026

On 10 December 2025, the Director General of Inland Revenue issued the Guidelines on Labuan Trading Activity and Labuan Non-Trading Activity (“Guidelines”), which clarify the definitions of Labuan trading and non-trading activities under the Labuan Business Activity Tax Act 1990 and related regulations, with direct implications for the applicable tax treatment of Labuan entities.

This article provides an overview of the Guidelines.