MAS provides an update to fund tax incentive schemes for family offices
We have set out below the key changes that were announced via MAS’ circular FDD Cir 10/2024:
Extension of fund tax incentive schemes and related remission schemes
The expiry date of 13D, 13O and 13U schemes has been extended to 31 December 2029. In addition, the Goods and Services Tax remission scheme and withholding tax exemption continue to apply.
Minimum assets under management (“AUM”) for 13O and 13U
13O and 13U funds must meet a minimum AUM requirement at the end of each financial year from 1 January 2025:
- 13O – S$5million in designed investments (DI)
- 13U – S$50million in DI.
From 1 January 2025, AUM shall also be computed based on the value of investments instead of net asset value.
Minimum local business spending (LBS) for both 13O and 13U schemes
There is to be a new tiered minimum LBS criteria for both schemes, subject to transitional arrangements:
| AUM (S$) | Minimum spending (S$) |
|---|---|
| AUM < 250m | 200,000 |
| 250m ≤ AUM < 2b | 300,000 |
| AUM ≥ 2b | 500,000 |
Close-ended fund treatment for funds
Close-ended funds may make an irrevocable one-time election to waive minimum AUM and tiered LBS requirements after a specified period.
Changes to investment objective/strategy for both 13O and 13U funds
The condition to invest only in MAS approved investment strategies shall be removed. The fund, however, should only invest within the scope of its offering documents or investment management agreements.