Introduction to Single Family Office
Why set up a Family Office?
- To use the family fund managed by the Family Office as a platform to make investments globally
- To facilitate succession planning for family wealth and/or business</li
- To manage the family wealth and investments through a professional team
- To provide a pathway for key family members to acquire a legitimate status to work and be based permanently in Singapore
What is a Family Office?
- Single Family Office
- A single family office (‘’SFO’’) is an undefined term, but typically refers to an organisation that manages assets and for or on behalf of one family.
- Meaning of members of the same family, i.e. lineal descendants from a single ancestor, including spouses, ex-spouse, adopted children and step children of such descendants.
- Generally, it is exempted from licensing.
- Multi Family Office
- A multi family office serves a number of families, acting as wealth advisor and manager to multiple families.
- Is regulated and needs licensing.
Licensing exemption for SFOs
- Exempted Structures
- All three examples qualify for the related corporation exemption under the Securities and Future Acts of Singapore
Singapore Family Office – 13R
13X/13R tax exemptions for Family Office
- Project Flow chart for reference
Tax exemptions
Overview
- Benefits of setting up an SFO: tax exemptions
- 3 relevant tax exemptions under the income Tax Act (Cap. 134 of Singapore) (‘’ITA’’):
- 1. Section 13R (Onshore fund tax exemption scheme)
- 2. Section 13X (Enhanced tier fund tax exemption scheme)
- 3. Section 13CA (Offshore fund tax exemption scheme)
- General rule of thumb: to qualify, the fund must be managed by a Singapore-based fund manager.
- Exemptions currently extended to 31 December 2024 pursuant to Budget 2019.
Key features of 13R, 13X and 13CA
Variable Capital Company (‘’VCC’’)
- A variable capital company (‘’VCC’’) is a corporate structure for investment funds. It can be formed as a single standalone fund, or an umbrella fun funds, each holding different assets.
- Currently, an SFO cannot manage a VCC.
- The discussion has been ongoing to allow an SFO to manage a VCC.
Singapore Family Office – 13X
Singapore Family Office – 13CA
Structure of a Singapore Reserved Powers Trust
For any information on how to set up a family office, please contact our team by email at info@opkofinance.com or by phone at +852 2654 8800.
