Number of Family Offices in Singapore set to grow
Last updated on 31 May 2023
In today’s fast-paced world and business environment, more high-net-worth families are seeking professional advice and expertise in managing their assets. Increasingly, many such families are setting up family office in Singapore to take advantage of the country’s stable political situation and business-friendly environment.
There are mainly 2 types of family offices: Single family office (SFO) and Multi-family office (MFO). An SFO serves only one family, while a MFO serves the interests of more than one family. While there are differences between SFOs and MFOs, both types allow families to manage their private assets, investments and other family affairs across generations.
The founding family typically owns an SFO, and it is separate from the family’s other operating businesses. Being customised to a family’s needs and goals, family office services sought by owners can be varied and take an array of forms.
Typical Family Office Structure
In Singapore family office requirements under Section 13O of the onshore fund tax exemption scheme; fund must have a minimum fund size of S$10 million at the point of application, and commit to increasing its AUM to S$20 million within a 2 -year grace period, minimum business spending and hiring experienced investment professionals to manage the family’s portfolio of assets.
In addition, various tax exemption schemes are available to SFOs, some of which are subject to approval by the Monetary Authority of Singapore (MAS).
Currently, Singapore has about 700 family offices, and the number is expected to grow. The growth in family office Singapore has seen correspondingly increased demand for more wealth management professionals in Singapore. In 2021, the MAS and the Institute of Banking & Finance (IBF) came together to map out the competencies that employees of SFOs and external service providers advising the SFOs, should acquire. The improvements in these areas will upgrade the wealth management ecosystem and other related services and industries, such as philanthropy.