Finance Leasing Business

1. Finance Leasing Business

2. The acquisition of assets, specifically costly capital equipment is a huge commitment for many businesses. The process for acquiring the funds requires careful planning. Instead of paying for the asset outright using cash, it frequently makes sense for businesses to seek methods of spreading the cost of acquiring an asset, to coincide with the timing of the revenue generated by the business. The most common sources of medium-term finance for investment in capital assets are Hire Purchase and Leasing. Leasing and hire purchase are financial facilities which allow a business to use an asset over a fixed period, in return for regular payments. The business customer selects the equipment it needs and the finance company purchases it on behalf of the business. Overview

4. The Finance Leasing or 'full pay out lease' is closest to the hire purchase alternative. The leasing company recovers the full cost of the equipment, plus charges, over the period of the lease. Although the business customer does not own the equipment, they have most of the 'risks and rewards' associated with ownership. They are responsible for maintaining and insuring the asset and must show the leased asset on their balance sheet as a capital item. When the lease period ends, the leasing company will generally agree to a secondary lease period at significantly reduced payments. Optionally, if the business wants to stop using the equipment, it can be sold second-hand to an unrelated third party. The business arranges the sale on behalf of the leasing company and acquires the bulk of the sale proceeds. Need for Finance Leasing

5. The use of hire purchase or Leasing is a popular method of funding the acquisition of capital assets. Although, these methods are not necessarily optimal for every business or for every asset purchase. There are a number of considerations to be made, as mentioned below – Certainty Budgeting Fixed Rate Finance Impact of Security Maximum Finance Tax Advantages Advantages of Leasing

6. Labuan Leasing Structure: [Foreign Co-asset Owner] Benefits • Labuan Leasing Company is taxed at 3% of net audited profits • No Withholding Tax on lease rental received from Malaysian customers • No Withholding Tax on lease rental payable by Labuan Leasing Company to Foreign Company • Access to more than 70 Malaysia Tax Treaty partners to reduce Withholding Tax on lease rental received by Labuan Leasing Company from Foreign Customers • Liberal exchange control environment in Labuan Labuan Leasing Structure: [Foreign Financier] Benefits • Labuan Leasing Company is taxed at 3% of net audited profits • No Withholding Tax on lease rental received from Malaysian Customers • No Withholding Tax on interest payment payable by Labuan Leasing Company to Foreign Financier Typical Labuan Leasing Structures

7. 3% corporate tax on net audited profits • No withholding tax on dividends, interest, technical fee and royalty / lease rental • No stamp duty on all instruments including share transfers • No import duty / sales tax • No foreign exchange controls • No capital gain tax and inheritance tax • Enjoy Malaysia’s Double Tax Agreements with over 70 countries • 50% personal tax exemption for expatriate professionals employed by the leasing company • 100% tax exemption for director’s fees received by non-citizen directors To understand the Leasing Process in Labuan, contact the QX Trust team advisers at +60 39212 6940 or consultant@qx-trust.com for a free consultation. Tax Advantages of Labuan Leasing Company

8. CONTACT US :- +60 3 9212 6940 VISIT HERE: https://www.offshore-labuan.com/ ADDRESS:- Unit No. 3A-16, Level 3A Labuan Times Square, 87000 F.T. Labuan, Malaysia For More Information Contact Here