Singapore as an Ideal Place to Set Up Family Offices
By Nikki Cheong, SingAlliance Pte Ltd
Asia has experienced a boom in wealth creation, largely in the last two generations, minting new UHNWIs at a faster rate, surging in demand to preserve family legacy and wealth.
Singapore, a choice destination with many advantages in aspects of business, asset protection, and personal, has also benefitted from a slew of high-profile investors setting up family offces in the country. Investors exploring immigration to Singapore may consider setting up a family offce that offers employment passes as a springboard to permanent residency in future.
To enhance Singapore’s attractiveness as a financial hub, domestic legislation provides for tax exemption (under Sections 13R/13X) on “specified income” derived from “designated investments”. Under such incentive schemes, family offces can utilise the new Variable Capital Company (VCC) structure for open/close-ended investment funds with traditional and alternative strategies, and foreign funds could also be inward re-domiciled as VCCs.
Other benefits of VCCs include flexibility in distribution from income or capital, as the capital of VCCs will always be equal to its net assets, as well as preserving confidentiality, as financial statements and shareholder information of a VCC are not publicly available.
VCCs require local service providers’ engagement to maintain substance, including a Singapore licensed/ regulated fund manager. Instead of going through the lengthy process of acquiring regulatory requirements and substantial resources to employ investment expertise to establish infrastructure, single-family offces may outsource the asset management activities to a qualified fund manager.
Today’s fast-changing landscape necessitates the rise of global citizens and long-term planning of wealth for future generations. Singapore’s strategic location, stable political environment, multiracial society, and world-class healthcare system are compelling considerations for wealthy families to make the move.
Nikki CheongGGI member firm
SingAlliance Pte Ltd
Advisory, Fiduciary and Estate Planning
T: +65 6303 5050
SingAlliance is an independent asset manager with presence in Singapore, Hong Kong, and Geneva, specialising in providing wealth management solutions to HNW individuals, families, and institutions. In Singapore, SingAlliance holds a Capital Market Services licence for Fund Management issued by the MAS.
Nikki Cheong is a Senior Relationship Manager at SingAlliance Singapore with more than 12 years of private wealth management experience in Hong Kong, Geneva, and Singapore. She first joined SingAlliance as a Portfolio Manager specialising in equities, before switching roles in early 2020 to service HNW clients in Asia.
Published: Trust & Estate Planning Newsletter, No. 06, Autumn 2020 l Photo: SeanPavonePhoto - stock.adobe.com