The family office landscape in Asia has been undergoing a significant transformation in recent years. Singapore has emerged as one of the top global destinations for ultra-high-net-worth individuals (UHNWIs) to establish their family offices.
Amongst the tumult of COVID-19 and shifting political tides globally, Singapore has nearly doubled its family office holdings from 400 in 2020 to 700 in 2023.
It is not just facing prominent demand from just Asia, but also beyond, such as Europe and America. Increasingly, these non-Asian families are choosing Singapore to establish family offices or satellite offices to seize and support their regional investments.
There is good reason for this, and it is not just because of Singapore’s traditional advantages — Singapore is making major plays to attract UHNWIs, and will continue to do so.
Let us discuss why Singapore continues to be an ideal home for family offices beyond the region, taking into consideration the historical success factors, recent developments and updates, and the future outlook for the industry.
Historical Success of Family Offices in Singapore
Before we look too far towards the future, let us take a look at the foundational elements of Singapore that have traditionally made it an attractive location for family offices.
Singapore’s strategic location at the heart of Asia has made it an attractive hub for UHNWIs seeking to manage their wealth and investments closer in the region.
Its proximity to emerging markets in the region, coupled with excellent connectivity and infrastructure, allows family offices to access a diverse range of investment opportunities and tap into the growing Asian market.
In terms of a strategic gate between West to East, you could not find a better location.
Stable Political and Economic Environment
One of the key factors that have contributed to Singapore’s success as a family office hub is its stable political and economic environment.
The city-state has consistently ranked highly in various global indices for its:
- Political stability (third in the world)
- Economic freedom (first in the world)
- Ease of doing business (second in the world)
These factors provide a secure and conducive environment for wealth management and preservation.
Robust Regulatory Framework
Singapore is well-regarded for its robust regulatory framework, which promotes transparency, integrity, and compliance with international standards.
The Monetary Authority of Singapore (MAS) has implemented policies and regulations specifically tailored for family offices.
These policies ensure that they operate within a well-regulated environment while offering a high degree of flexibility and confidentiality.
A prime example of this would be the Family Office Development Team (FODT) set up but the MAS in 2019 to lead and create initiatives that will enhance Singapore’s position as the primary Global Family Office Hub in Asia and beyond.
The FODT looks to build an ecosystem that is responsive to the evolving needs of family offices and their UHNWI clients and to promote Singapore as a trusted and well-regulated hub for family offices.
Recent Developments and Updates
Time and time again, Singapore has shown it’s not willing to rest on the laurels of strong foundational components, and the family office sector is no exception. The government has continued to invest in the sector, both through financial and legislative efforts.
Enhancing Quality and Economic Benefits
MAS implemented more stringent tax regulations last year that stipulate minimum capital, local investment, and talent recruitment requirements for family offices to be eligible for tax incentives.
Family office-managed or advised funds must maintain a minimum fund size of S$10 million upon application and S$20 million within two years.
Furthermore, family offices falling under this section are required to employ at least two investment professionals. Previously, no such stipulations existed for fund sizes or employees.
These revised regulations indicate the Singaporean authorities’ commitment to improving the calibre of family offices and creating positive economic repercussions for the country.
Ultimately, they render Singapore even more appealing in its reliability and security for UHNWIs seeking to establish family offices.
Global-Asia Family Office Circle Network
The launch of the Global-Asia Family Office Circle network in 2021 has provided a "trusted ecosystem" for industry players to collaborate and share best practices, according to Ms Foo Mee Har, CEO of the Wealth Management Institute and Member of Parliament.
This initiative further strengthens Singapore’s family office ecosystem and enhances its appeal to UHNWIs by advocating for targeted tax incentives.
Capturing New Opportunities in Philanthropy
A new tax donation scheme has been introduced to ground family offices in Singapore, enhancing the city-state’s status as a hub for philanthropy.
It presents a new opportunity for Singapore in an aspect that the ultra-rich is paying a more significant deal of attention to.
Unlike in the past, philanthropy has become more deliberate and strategic, with younger generations preferring to be more hands-on with active engagements.
This initiative aligns with the increasing focus on social impact and sustainability among UHNWIs, making Singapore an even more compelling choice for family offices.
Individuals with family offices will receive a 100% tax deduction for donations made overseas, allowing for increased philanthropic contributions.
To qualify for this tax deduction, donations must be made through approved local intermediaries. However, the tax deduction is capped at 40% of the donor’s statutory income, ensuring a balance between promoting philanthropy and maintaining fiscal responsibility.
With this, Singapore sends a message to family offices keen on giving back to the local community in the region, cementing itself as the best place to do so.
The Future of Family Offices in Singapore
With the ongoing global economic uncertainty and the growing importance of Asia in the world economy, Singapore’s relevance as a family office hub is expected to continue.
The city-state’s commitment to innovation and adaptability, along with its continuous efforts to enhance its regulatory framework and support systems for family offices, positions it well to remain an attractive destination for UHNWIs and their wealth management needs.
Setting Up a Family Office in Singapore With InCorp
At InCorp, we understand the unique requirements of UHNWIs looking to establish a family office in Singapore.
Our team of experts is well-versed in the intricacies of Singapore’s regulatory environment. We can help you navigate the process of setting up a family office that meets your specific needs and objectives.
From advising on the optimal structure to ensuring compliance with local regulations, InCorp is your trusted partner in ensuring your family’s legacy for decades to come. Contact us today for more information!
Contact our team
- Singapore offers a strategic location, stable political and economic environment, robust regulatory framework, and a well-developed ecosystem for family offices, making it an ideal location for UHNWIs to manage their wealth and investments.
InCorp's team of experts can help you navigate the process of:
- Setting up a family office in Singapore
- Advising on the optimal structure
- Ensuring compliance with local regulations
- Providing ongoing support for the successful establishment of your family office
Some of the most prominent family offices in Singapore include:
- Tolaram Group
- Bayshore Global Management
- Weybourne Group
- Oppenheimer Generations