Demand for structured wealth management and legacy planning has surged globally. A family office is a private vehicle that manages the wealth, succession, and often lifestyle of ultra-high-net-worth individuals.
In recent years, Singapore has emerged as the premier hub in Asia, offering a stable regulatory environment, tax incentives, and high standards of professional services, making it an ideal destination for setting up your family office.
This blog will guide you on the requirements for setting up a family office in Singapore.
What is a Family Office?
A family office is a wealth and asset management entity established to manage the private affairs of ultra-high-net-worth individuals. It serves as a management system that preserves and grows wealth across generations and helps in estate planning.
Family offices are involved in a range of activities from investment management, tax planning, and succession planning to concierge and philanthropic services.
In Singapore, these take two main forms:
- Single Family Offices (SFOs): Dedicated to one family and fully customized for their needs.
- Multi-Family Offices (MFOs): Serve multiple families, offering economies of scale while maintaining tailored advice.
The choice between these two depends on the aggregate net worth of the family, the complexities of financial needs and the desired level of personalized attention.
A well-structured family office will often include the following functional entities or roles:
Function |
Description |
|---|---|
Investment Entity
|
Holds and manages family assets, such as equities, private equity, or real estate.
|
Management Company
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Employs investment professionals, oversees operations, and executes the family’s investment strategy.
|
Trust or Holding Entity
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Provides asset protection and tax planning flexibility.
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Philanthropy Arm
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Manages donations, foundations, or social impact Investments.
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Family Governance Body
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Family council, investment committee, or board that aligns family and professional interests.
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Singapore Family Office Structures
Establishing the right legal and operational structure is critical to the success of a family office. In Singapore, structures are tailored based on the family’s investment strategy, risk appetite, tax planning objectives, and governance preferences.
Your family office can be structured as one of the following:
- Private Limited Company
- Singapore Variable Capital Company (VCC)
- Trust
All of these can either be SFO or MFO subject to conditions and legal requirements.
Additionally, each legal structure has implications for taxation, asset control, confidentiality, and regulatory compliance.
For example, families establishing investment funds may prefer the VCC due to its flexibility in managing pooled assets and offering sub-fund segregation, while Pte Ltd companies are typically used for holding investment portfolios or employing staff locally.
You can find more information about the requirements of each type of structure on the blog dedicated to Singapore family office structures.
Key Considerations for Structuring
When designing the structure, families typically focus on:
- Governance: Who has decision-making authority, and how are decisions escalated?
- Tax efficiency: How to benefit from exemptions under Sections 13O and 13U?
- Risk segregation: How to separate operating, investment, and philanthropic activities?
- Succession: How will assets and responsibilities pass to the next generation?
- Economic substance: Ensuring sufficient staff and operations are in Singapore to meet MAS and IRAS expectations.
Succession Planning and Governance
The central purpose of family offices is to ensure smooth succession planning across generations. This is achieved through:
- Governance frameworks: Family constitutions, charters, and clearly defined decision-making processes.
- Professional oversight: Investment committees and external advisors to temper family influence.
- Succession mechanisms: Role clarity, continuity playbooks, and structured training for heirs.
Effective governance aligns family values with professional rigor, safeguarding long-term wealth.
Choosing the Right Jurisdiction
When setting up a family office, selecting the right jurisdiction is critical to ensuring long-term stability, tax efficiency, and operational ease. Below are key factors to consider:
Function |
Description |
|---|---|
Regulatory clarity and stability
|
Choose a jurisdiction with transparent and consistent regulations to avoid legal uncertainties that could disrupt operations or affect tax status.
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Favorable tax regime
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A low or structured tax environment can enhance after-tax returns, especially when tax exemptions or incentives apply to investment income.
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Access to financial markets and talent
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Jurisdictions with deep capital markets and a strong pool of legal, financial, and investment professionals support more effective wealth management.
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Ease of doing business
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Administrative efficiency, legal infrastructure, and speed of processes (e.g. bank account setup, fund registration) reduce friction in daily operations.
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Why Choose Singapore for Your Family Office?
Setting up a family office in Singapore is one of the best ideas for the following reasons:
- Tax incentives under Sections 13O/13U of the Income Tax Act allow tax exemption on specified investment income for funds managed locally.
- As per DLA Piper, in 2024, over 2,000 single family offices have been set up in Singapore, growing ~43% from 2023.
- Singapore hosts 59% of all family offices in Asia – more than any other country in Southeast Asia.
- Exceptional political stability, economic stability, clean legal framework, and operational efficiency make it a highly trusted jurisdiction.
- Government support is coordinated through the Family Office Development Team (FODT) and partnerships like the Global-Asia Family Office Circle.
- The Monetary Authority of Singapore (MAS) now processes family office tax incentives significantly faster, reducing approval times from 12 to 3 months, while private banks expedite account opening.
- Singapore has no estate duty, inheritance or gift taxes, which eases and reduces cost of wealth transfer.
FAQs
What are the requirements for setting up family offices in Singapore for SFOs?
To qualify under Section 13U/13O tax incentive schemes, Single Family Office’s must meet several criteria:
- Meet the fund requirements as follows –
- Section 13O: Funds must maintain at least SGD 5 million in DI annually.
- Section 13U: Funds are now required to maintain the SGD 50 million AUM threshold annually, ensuring sustained investment activities.
- Employ at least three investment professionals, with at least one non-family executive.
- Subject to tiered spending requirements with a minimum spending of S$200,000 in local businesses.
- Have a private bank account with an MAS-licensed financial institution at the point of application and throughout the incentive period.
- The MAS should approve the Scheme.
You can find more detailed information on MAS’s website.
How much does a family office in Singapore cost?
The charge varies case by case but, generally, is around 2-3% per year.
Singapore offers a compelling environment for family office setup, combining attractive tax incentives, strong governance, and a mature support ecosystem. With fast-growing numbers of SFOs and government-backed facilitation, families benefit from world-class wealth stewardship and succession planning. If you’re seeking to establish a well-structured and future-ready establishment, a family office in Singapore remains a top choice.