Singapore vs Hong Kong Tax Incentives for Family Offices: 13O, 13U, VCC, and FIHV Compared

Key Takeaways

• Singapore and Hong Kong both offer 0% tax on qualifying family office income, but their structures, thresholds, and compliance requirements differ significantly
• Singapore’s Section 13O now requires S$20 million in designated investments at the point of application, with no grace period, following MAS changes in January 2025
• The Variable Capital Company (VCC) in Singapore has exceeded 1,000 incorporations by 2026, becoming Asia’s preferred sub-fund structure for multi-strategy family offices
• Hong Kong’s FIHV tax concession requires HK$240 million aggregate NAV in specified assets, two qualified staff, and HK$2 million annual operating expenditure - and now includes digital assets, precious metals, and private credit following the 2026 Budget
• Sophisticated families increasingly operate dual-hub structures across both jurisdictions, requiring consolidated reporting, multi-currency settlement, and cross-border compliance infrastructure

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Table of Contents

1. The Variable Capital Company: Singapore’s Fastest-Growing Fund Structure
2. Singapore vs Hong Kong: Master Tax Incentive Comparison
3. Singapore Section 13O: Requirements After January 2025
4. Singapore Section 13U: The Flexible Alternative
5. Singapore Section 13OA: The New LP Structure
6. Hong Kong FIHV: Profits Tax Concession Framework
7. Hong Kong SFC Licensing for Family Offices
8. Choosing Your Tax Structure: A Decision Framework
9. The Dual-Hub Model: Operating Across Both Jurisdictions
10. Common Compliance Pitfalls
11. Frequently Asked Questions

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The Variable Capital Company: Singapore’s Fastest-Growing Fund Structure

The Variable Capital Company (VCC) has become the dominant fund vehicle for family offices establishing in Singapore. Introduced under the VCC Act in 2020, the framework has seen rapid adoption, exceeding 1,000 VCC incorporations by April 2026 according to MAS data.

A VCC operates as an umbrella entity housing multiple sub-funds, each with its own investment strategy, investors, assets, and liabilities. Under Section 29 of the VCC Act, the assets and liabilities of each sub-fund are legally ring-fenced from every other sub-fund. This segregation allows a single family office to manage real estate, private equity, liquid portfolios, and alternative investments through separate sub-funds within one legal entity.

For family offices operating under Singapore’s Section 13U tax incentive scheme, VCCs offer a combination of tax efficiency, structural flexibility, and confidentiality that traditional company structures cannot match:

• Sub-fund flexibility. Create, restructure, or wind down individual sub-funds without affecting others. No separate company incorporation required for each asset class or strategy.
• Confidentiality. VCCs are not required to file financial statements publicly with ACRA, unlike Singapore-incorporated companies under Section 13O. The register of members is maintained privately.
• Tax treaty access. VCCs benefit from Singapore’s extensive double taxation agreement network spanning 90+ jurisdictions.
• Regulatory alignment. MAS issued revised AML/CFT Notices and Guidelines for VCCs effective 1 July 2025, bringing governance standards in line with established fund management frameworks.

The VCC structure is particularly relevant for families managing portfolios across multiple asset classes or jurisdictions. Rather than maintaining separate entities in each market, a single VCC can house sub-funds dedicated to Greater China equities, Middle East real estate, global fixed income, and private credit - each with ring-fenced liability and independent NAV calculations.

Source: MAS Fund Tax Incentive Schemes, VCC Act 2020, MAS Circular IID 04/2025.

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Singapore vs Hong Kong: Master Tax Incentive Comparison

Both Singapore and Hong Kong offer 0% tax on qualifying family office income. The structures differ in their legal requirements, AUM thresholds, entity types, and regulatory frameworks. The following table compares all four primary structures available to family offices considering either or both jurisdictions.

Dimension	Singapore 13O	Singapore 13U	Singapore VCC (within 13U)	Hong Kong FIHV	Source
Tax treatment	0% on qualifying designated investments	0% on qualifying designated investments	As per 13U wrapper	0% profits tax on qualifying transactions	MAS, IRD
AUM minimum	S$20M in designated investments at application	S$50M minimum fund size	As per 13U wrapper	HK$240M aggregate NAV in specified assets	MAS Jan 2025, IRD
Entity type	Singapore-incorporated company	Flexible (offshore vehicles, VCC, Cayman, BVI, Luxembourg)	Variable Capital Company with sub-funds	Private company limited by shares	MAS, Companies Ordinance
Investment professionals	Min 2 resident in Singapore	Min 2 resident in Singapore	As per 13U	Min 2 qualified full-time employees in HK	MAS, IRD
Local spending	Tiered: S$200K (<S$50M), S$500K (S$50-100M), S$1M (>S$100M) per year	Tiered, based on AUM	As per 13U	HK$2M annual operating expenditure	MAS Jan 2025, IRD
Local investment	Min 10% of AUM or S$10M (whichever lower) in SG investments	Similar local investment requirements	As per 13U	No specified local investment requirement	MAS, IRD
Ownership	Family ownership of fund management company	Family ownership of fund management company	Sub-fund structure within umbrella VCC	95% beneficial interest by family members	MAS, IRD
Confidentiality	Financial statements filed with ACRA	Financial statements filed with ACRA	No public filing with ACRA	Financial statements filed with Companies Registry	ACRA, CR
Regulatory body	Monetary Authority of Singapore	Monetary Authority of Singapore	Monetary Authority of Singapore	Inland Revenue Department / SFC	MAS, IRD, SFC
Scheme expiry	31 December 2029	31 December 2029	No expiry (permanent legislation)	No expiry	MAS, FSTB
Application timeline	4-6 months typical	4-6 months typical	1-2 months for VCC incorporation	N/A (self-assessment at tax filing)	MAS, ACRA

Source: MAS Circular on Section 13O/13U (January 2025), IRD Tax Concessions for FIHV, FSTB Family Office Policy Statement (2025). Data current as of May 2026.

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Singapore Section 13O: Requirements After January 2025

Section 13O is MAS’s tax incentive scheme for single family offices managing assets through a Singapore-incorporated fund vehicle. Following significant changes in January 2025, the scheme now requires greater upfront commitment and ongoing substance.

What changed in January 2025

The most significant change: the grace period for AUM has been removed. Previously, applicants could apply with S$10 million in assets and had two years to reach S$20 million. From January 2025, S$20 million in designated investments is required at the point of application, with no ramp-up period.

Other changes tightened how AUM is measured. MAS now calculates the minimum based on designated investments only - cash deposits, direct real estate holdings, and other non-qualifying assets no longer count toward the threshold. Family offices must also maintain the S$20 million minimum at the end of every financial year, not only at application.

Current 13O requirements (as of May 2026)

Requirement	Detail	Source
AUM	S$20M in designated investments at application and throughout	MAS Jan 2025
Fund vehicle	Singapore-incorporated company	MAS
Investment professionals	Min 2, resident in Singapore, earning >S$3,500/month, >50% time on qualifying activity	MAS
Local business spending	Tiered: S$200K (<S$50M AUM), S$500K (S$50-100M), S$1M (>S$100M) annually	MAS Jan 2025
Local investment	Min 10% of AUM or S$10M (whichever lower) in Singapore-based investments	MAS
Banking	Private banking account with MAS-licensed institution required throughout	MAS
Scheme duration	Extended to 31 December 2029	MAS
Reporting	Annual CRS returns filed with IRAS	IRAS

Existing 13O awardees with awards commencing before 1 January 2025 have a transitional period. These awardees must comply with all updated IP, AUM, and local business spending requirements from the financial year ending in 2027 (Year of Assessment 2028).

For a comprehensive guide to launching a family office in Singapore, including structure selection, banking, and staffing considerations, see our separate playbook.

Source: MAS Fund Tax Incentive Schemes for Family Offices (January 2025 update), MAS FAQs on Schemes for SFOs.

For families navigating the updated 13O requirements, learn how our platform supports MAS compliance from application through ongoing reporting.

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Singapore Section 13U: The Flexible Alternative

Section 13U serves larger, more complex family structures that need flexibility in fund domicile and vehicle type. The minimum AUM is S$50 million - more than double the 13O threshold - but the structural options are significantly broader.

Unlike 13O, which requires a Singapore-incorporated company, 13U accommodates offshore vehicles domiciled in Cayman, BVI, Luxembourg, and other jurisdictions. It also supports VCC structures, making it the natural choice for families using the sub-fund framework described above.

Dimension	13O	13U
AUM minimum	S$20M (designated investments)	S$50M
Vehicle flexibility	SG-incorporated only	Offshore, VCC, or SG-incorporated
Typical use	Single-strategy SFOs	Multi-strategy, multi-jurisdiction families
Confidentiality	ACRA filing required	Depends on vehicle (VCC: no ACRA filing)
Complexity	Lower	Higher

The January 2025 changes apply to 13U as well. The S$50 million must be maintained at the end of every financial year, and AUM is measured against designated investments. The local business spending tiers and investment professional requirements mirror those of 13O.

Section 13U is the preferred scheme for families with existing offshore fund structures, those managing assets across multiple jurisdictions, or those who require the privacy benefits of a VCC wrapper.

Source: MAS Fund Tax Incentive Schemes for Family Offices, MAS Circular January 2025.

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Singapore Section 13OA: The New LP Structure

Introduced in January 2025, Section 13OA extends tax incentives to funds structured as limited partnerships. This structure is primarily relevant for family offices with significant allocations to private equity and venture capital.

The LP structure allows a fund management entity to serve as general partner while family members and their vehicles participate as limited partners. This mirrors the standard PE/VC fund architecture, making it easier for family offices to co-invest alongside institutional limited partners or to manage direct investment portfolios using familiar governance structures.

Section 13OA is not the default route for single family offices managing traditional portfolios. Families focused on listed securities, fixed income, and multi-asset strategies will typically use 13O or 13U. The LP structure is best suited for families with meaningful PE/VC allocations who want tax-incentivized treatment within a regulated Singapore framework.

Source: MAS Fund Tax Incentive Schemes for Family Offices (January 2025 update).

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Hong Kong FIHV: Profits Tax Concession Framework

Hong Kong’s Family-owned Investment Holding Vehicle (FIHV) tax concession provides 0% profits tax on qualifying transactions conducted by eligible family investment holding vehicles. The regime, effective from the year of assessment 2022/23 onward, offers a structurally different approach from Singapore’s application-based incentive schemes.

How the FIHV regime works

Unlike Singapore’s 13O and 13U, which require upfront application to MAS and ongoing scheme compliance, Hong Kong’s FIHV tax concession operates on a self-assessment basis. Family offices structure their investment activities to meet the qualifying conditions and claim the tax concession through their annual profits tax filing with the Inland Revenue Department (IRD).

FIHV qualifying conditions

Requirement	Detail	Source
Ownership	One or more family members must hold at least 95% beneficial interest in the FIHV throughout the year of assessment	IRD
Aggregate NAV	Minimum HK$240 million in specified assets (measured at year-end, 2-year grace period for new FIHVs)	IRD
Staffing	At least 2 qualified full-time employees in Hong Kong carrying out core income-generating activities	IRD
Operating expenditure	Minimum HK$2 million annual operating expenditure incurred in Hong Kong	IRD
Management	FIHV must be managed by an eligible single family office	IRD
Entity type	Private company limited by shares	Companies Ordinance
Core activities	Core income-generating activities (CIGAs) must be carried out in Hong Kong	IRD

Qualifying transactions

Profits tax concessions apply to assessable profits arising from qualifying transactions and incidental transactions. Qualifying transactions include dealings in securities, shares, stocks, debentures, loans, deposits, futures contracts, and foreign exchange contracts.

2026 Budget expansion

The Hong Kong government’s 2026-27 Budget expanded the list of eligible asset classes for FIHV tax concessions to include digital assets, precious metals (including gold), and private credit instruments. This expansion reflects Hong Kong’s strategy to position itself as a hub for alternative asset management within regulated family office structures.

Hong Kong family office growth

Hong Kong is home to 3,384 single family offices as of end 2025, adding 681 since the end of 2023 - a 25% increase over the two-year period. Among surveyed SFOs, 32.4% (1,095) manage AUM above US$100 million. Family office and private trust clients of Hong Kong’s licensed corporations hold approximately HK$2 trillion in assets under management.

For a broader comparison of DIFC, Singapore, and Hong Kong as family office jurisdictions beyond tax incentives - including regulatory frameworks, lifestyle factors, and multi-hub strategies - see our separate analysis.

Source: IRD Tax Concessions for FIHV, FamilyOfficeHK Tax Concessions, Deloitte Family Office Landscape in Hong Kong Market Study (February 2026), IRD 2026-27 Budget Tax Measures.

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Hong Kong SFC Licensing for Family Offices

A single family office in Hong Kong does not require a Securities and Futures Commission (SFC) license if it manages only the assets of a single family and does not provide services to external third parties. This exemption makes the SFO structure administratively simpler than equivalent structures in Singapore, where a Fund Management Company license (or exemption) is required under MAS.

When a family office crosses into discretionary portfolio management for external parties - or when it manages assets across multiple unrelated families - a Type 9 (Asset Management) license from the SFC is required. Multi-family offices in Hong Kong therefore operate under a different regulatory framework than their SFO counterparts.

Virtual asset considerations

Hong Kong’s regulatory approach to virtual assets within family office portfolios is evolving. The SFC has been expanding its virtual asset framework, and the FIHV tax concession now explicitly includes digital assets following the 2026 Budget. The government plans to introduce legislative proposals in 2026 to regulate virtual asset dealers and custodians, applying the “same business, same risks, same rules” principle.

For family offices with crypto or digital asset allocations, Hong Kong’s framework provides a regulated path for including these assets within tax-concession-eligible portfolios - a distinction from Singapore’s more conservative stance on digital asset eligibility within 13O/13U designated investments.

New Capital Investment Entrant Scheme (CIES)

Hong Kong’s CIES provides a residency pathway for high-net-worth individuals investing a minimum of HK$30 million in qualifying financial assets. While not exclusively a family office mechanism, CIES is frequently used alongside FIHV structures by families relocating to Hong Kong and establishing local investment operations. Enhanced CIES measures introduced by InvestHK aim to streamline applications for qualifying family office principals.

Source: SFC Licensing Requirements for Family Offices, FSTB Family Office Policy Statement, FamilyOfficeHK CIES Enhancement Measures.

To discuss how Singapore and Hong Kong licensing requirements apply to your family’s structure, speak with our team.

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Choosing Your Tax Structure: A Decision Framework

The right structure depends on five factors: portfolio size, asset class mix, jurisdictional needs, family complexity, and China exposure. The following decision framework maps common family office profiles to the most suitable tax incentive structure.

Family Profile	AUM Range	Recommended Structure	Rationale
Single-strategy SFO, SG-based	S$20-50M	Singapore 13O	Lowest threshold, straightforward compliance
Multi-strategy SFO, needs sub-funds	S$50M+	Singapore 13U with VCC	Sub-fund flexibility, no public filing, full structural control
PE/VC-focused family	S$20M+	Singapore 13OA	LP structure matches PE/VC governance model
Greater China-focused family	HK$240M+	Hong Kong FIHV	China market access via Stock Connect, Bond Connect, Wealth Management Connect
Multi-jurisdiction, 2+ hubs	S$50M+	13U/VCC + FIHV dual structure	SG treaty network + HK China access
Alternative assets (crypto, gold)	HK$240M+	Hong Kong FIHV	2026 Budget explicitly includes digital assets and precious metals

Families with portfolios under S$20 million that do not qualify for 13O may still benefit from Singapore’s general corporate tax framework (17% headline rate with partial exemptions) or from multi-family office arrangements that pool resources across families to meet economic substance requirements.

Australian families evaluating offshore restructuring following the 2026 Federal Budget should also review our analysis of Australia’s 30% trust tax and its implications for Singapore and Hong Kong structures. For families considering trust structures alongside their family office, our guide to family trusts in Singapore covers PTCs, QFTs, and cross-border succession planning.

Source: MAS, IRD, industry analysis. Thresholds current as of May 2026.

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The Dual-Hub Model: Operating Across Both Jurisdictions

Sophisticated family offices increasingly operate across both Singapore and Hong Kong rather than choosing one over the other. This dual-hub approach captures Singapore’s regulatory depth and treaty network alongside Hong Kong’s unmatched access to mainland China capital markets.

Running parallel structures introduces operational complexity. A family office maintaining a 13U/VCC in Singapore and an FIHV in Hong Kong needs:

• Consolidated reporting. Aggregating positions, valuations, and performance across sub-funds and entities in two regulatory environments with different reporting standards.
• Multi-currency settlement. Operating across SGD, HKD, USD, and potentially AED corridors with optimized FX execution and settlement timing.
• Cross-border compliance. Meeting substance requirements in both jurisdictions simultaneously - two investment professionals in Singapore, two qualified staff in Hong Kong - while maintaining consistent KYC/AML frameworks across entities.
• Coordinated tax filing. Ensuring qualifying transactions are correctly allocated between jurisdictions to maintain tax concession eligibility in both.

“The families we work with are not choosing between Singapore and Hong Kong. They are building infrastructure that operates across both. The question is no longer where to base your family office - it is how to connect your operations across the jurisdictions where your investments, your banking relationships, and your family members are located.”

• Frank G. Georgoulas, CEO, Aerapass

The dual-hub model requires technology infrastructure that is itself regulated across multiple jurisdictions. Operating requirements include multi-entity portfolio consolidation, automated regulatory reporting for both MAS and SFC/IRD requirements, and real-time position reconciliation across custodians in different markets.

Source: Industry analysis, Aerapass operational data.

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Common Compliance Pitfalls

Tax incentive revocation is the most expensive mistake a family office can make. The following issues account for the majority of compliance failures across both jurisdictions.

Singapore-specific pitfalls

1. AUM measurement changes. From January 2025, AUM is calculated based on designated investments only, not total fund NAV. Families that previously met the S$20 million threshold through a combination of qualifying investments and cash deposits may find themselves below the new minimum. Review portfolio composition against the current designated investments list.

2. Local business spending documentation. MAS requires documentation of tiered spending (S$200K-S$1M annually depending on AUM). Professional fees, salaries, office costs, and philanthropy contributions count, but the documentation must demonstrate genuine economic activity in Singapore. Payments to overseas service providers do not qualify.

3. Investment professional residency. Both IPs must be Singapore tax residents, earning above S$3,500 monthly, and spending more than 50% of their time on qualifying investment activity. Families using part-time or consulting arrangements may not meet this standard.

Hong Kong-specific pitfalls

1. 95% beneficial interest test. The family must maintain at least 95% beneficial interest in the FIHV throughout the entire year of assessment. Temporary dilution through co-investment arrangements or third-party capital introductions can disqualify the entire year.

2. Specified asset NAV timing. The HK$240 million threshold is measured at year-end. Families with concentrated positions or illiquid assets should monitor NAV closely through Q3 and Q4 to avoid falling below the minimum on the measurement date.

3. CIGA substance. Core income-generating activities must occur in Hong Kong. If investment decisions are made from a different jurisdiction with the Hong Kong office serving purely administrative functions, the FIHV may not qualify for the tax concession.

Cross-jurisdiction risks

For families operating dual-hub structures, the primary risk is conflicting compliance timelines. Singapore’s financial year can be set flexibly, while Hong Kong’s year of assessment runs April to March. Ensuring that substance requirements, AUM thresholds, and reporting obligations are met in both jurisdictions on their respective calendars requires dedicated compliance infrastructure.

Source: MAS FAQs on Schemes for SFOs, IRD DIPN No. 43, industry advisory practice.

Request a consultation to review your compliance framework across Singapore and Hong Kong before your next regulatory filing cycle.

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Frequently Asked Questions

What is a VCC in Singapore and how does it differ from a traditional company structure?

A Variable Capital Company (VCC) is a corporate structure introduced in 2020 specifically for investment funds. Unlike a traditional Singapore-incorporated company, a VCC can create multiple sub-funds within a single legal entity, each with its own investment strategy, investors, assets, and ring-fenced liabilities. VCCs are not required to file financial statements publicly with ACRA, providing greater confidentiality than standard companies. Over 1,000 VCCs have been incorporated in Singapore by 2026, and the structure is commonly used within Section 13U tax incentive arrangements for family offices managing multi-strategy portfolios.

How do Singapore’s Section 13O requirements compare to Hong Kong’s FIHV after the January 2025 changes?

Singapore’s Section 13O now requires S$20 million in designated investments at the point of application, with no grace period. This threshold is lower than Hong Kong’s FIHV requirement of HK$240 million (approximately S$42 million) aggregate NAV in specified assets. However, 13O requires a Singapore-incorporated company, at least two resident investment professionals, and tiered local business spending starting at S$200,000 annually. Hong Kong’s FIHV operates on a self-assessment basis without requiring upfront government application, but requires two qualified full-time employees in Hong Kong and HK$2 million annual operating expenditure. Both offer 0% tax on qualifying income.

Can a family office hold both a Singapore 13O/13U award and a Hong Kong FIHV tax concession simultaneously?

Yes. There is no restriction preventing a family from maintaining tax-incentivized structures in both jurisdictions. Many sophisticated families operate dual-hub structures with a 13U/VCC in Singapore and an FIHV in Hong Kong. Each jurisdiction’s tax concession is assessed independently based on that jurisdiction’s qualifying conditions. The operational challenge is meeting substance requirements in both locations simultaneously: two investment professionals resident in Singapore and two qualified staff in Hong Kong, along with the respective local spending and AUM thresholds.

What types of assets qualify for tax concessions under Hong Kong’s FIHV following the 2026 Budget?

Hong Kong’s 2026-27 Budget expanded the list of qualifying asset classes for FIHV tax concessions. Qualifying transactions now include dealings in securities, shares, stocks, debentures, loans, deposits, futures contracts, foreign exchange contracts, digital assets, precious metals (including gold), and private credit instruments. This expansion makes Hong Kong’s FIHV regime one of the broadest in terms of eligible asset classes for family offices, particularly for families with allocations to alternative investments, cryptocurrency, and commodity strategies.

What happens if my family office falls below the AUM threshold after receiving a tax incentive?

In Singapore, failing to maintain the minimum AUM (S$20 million for 13O, S$50 million for 13U) in designated investments at the end of any financial year can result in revocation of the tax incentive award. For existing awardees with awards predating January 2025, a transitional period applies through the financial year ending in 2027. In Hong Kong, the HK$240 million aggregate NAV threshold is measured at year-end, and new FIHVs receive a two-year grace period to meet the requirement. Falling below the threshold disqualifies the FIHV from claiming the profits tax concession for that year of assessment, but does not permanently disqualify the vehicle from future claims if the threshold is subsequently met.