Singapore is introducing a new set of measures aimed at strengthening its position as a leading global asset and wealth management hub.
On 19 August 2026, the Monetary Authority of Singapore (MAS) announced three measures targeting taxation, investment talent and support for hedge fund managers.
The three measures are:
- A proposed tax exemption for qualifying profit-related returns from fund management services
- A new Investment Management Track under the Overseas Networks & Expertise Pass (ONE Pass)
- A new Hedge Fund Investment Programme for hedge fund managers establishing or expanding their presence in Singapore
Together, these developments address three important considerations for the asset management industry: tax, talent and capital.
While the measures may have limited immediate impact on ordinary investors, they are particularly relevant to private equity(PE) and venture capital (VC) firms, hedge funds, asset managers, senior investment professionals and single-family offices operating or considering establishing a presence in Singapore.
1. Proposed Tax Exemption for Profit-Related Fund Management Returns
One of the most significant announcements concerns the taxation of performance-related returns earned by fund managers and investment professionals.
MAS and the Ministry of Finance plan to introduce a tax exemption for qualifying profit-related returns arising from fund management services provided to qualifying funds. In broad terms, these are returns where a fund manager or investment professional receives a contractual share of a fund's investment profits for providing fund management services.
This can be particularly relevant to investment professionals whose remuneration includes profit participation, such as carried interest or other qualifying performance-related arrangements. For senior investment professionals, these returns can form a significant part of their overall compensation.
However, the proposed exemption should not be interpreted as a general tax exemption for people working in the fund management industry. Ordinary salaries and other employee remuneration do not automatically become tax-exempt simply because an individual works for a fund manager. The proposed measure is specifically targeted at qualifying profit-related returns, subject to the final eligibility requirements.
MAS has indicated that qualifying funds may include those enjoying tax exemption under Sections 13D, 13O, 13OA, 13U and13V of Singapore's Income Tax Act and managed by Singapore-based fund managers.
This means the development could be relevant not only to conventional fund managers, but also to qualifying investment structures used by certain single-family offices.
What Could This Mean in Practice?
Consider a simplified example.
Suppose a Singapore fund management company receives S$2 million in qualifying profit-related returns. Singapore's headline corporate income tax rate is 17%.
If the entire S$2 million were taxable at the headline rate, without taking into account any deductions, exemptions, incentives or other tax treatment, the theoretical corporate income tax would be: S$2 million × 17% = S$340,000
If the returns ultimately satisfy all the conditions for the proposed exemption, their tax treatment could therefore be significantly different.
However, this is only a simplified illustration. Actual tax liability will depend on the fund and management structure, nature of the returns, the entity or individual receiving them, applicable deductions and exemptions, and whether other tax incentives apply.
Importantly, the new measure is still being developed.
MAS has stated that the tax exemption is expected to take effect from Year of Assessment 2027, with further details expected to be announced as part of Budget 2027. Fund managers and family offices should therefore avoid assuming that all performance-linked income will qualify until the final conditions are released.
2. A New ONEPass Track for Investment Management Professionals
Singapore's second measure focuses on attracting and retaining senior investment talent. MAS and the Ministry of Manpower intend to introduce a dedicated Investment Management Track under the ONE Pass.
The track is intended for global leaders and senior investment professionals who can contribute to Singapore's asset management industry. This addresses an important characteristic of remuneration within the investment management sector.
Senior investment professionals are not necessarily compensated through fixed salaries alone. Their overall remuneration may consist of fixed salary together with performance-related bonuses and returns linked to investment or fund performance.
Under the existing ONE Pass framework, applicants applying through the salary route generally need to demonstrate a fixed monthly salary of at least S$30,000, subject to the applicable requirements.
For example, consider an investment professional receiving:
- Fixed monthly salary: S$20,000
- Annual fixed salary: S$240,000
- Performance-related compensation: S$300,000
- Total annual compensation: S$540,000
Despite earning S$540,000 in total compensation, the individual's fixed monthly salary would remain S$20,000. This illustrates why compensation structures within the investment management industry may not always fit neatly within an assessment focused primarily on fixed monthly salary.
MAS has indicated that the new Investment Management Track may refine how salary is assessed, including potentially recognising returns linked to investment performance and fund outcomes. The precise eligibility criteria, the types of income that will be recognised and the supporting documentation required have not yet been fully announced.
It is therefore too early to assume that all bonuses, carried interest or performance-related returns will count towards ONEPass eligibility. Nevertheless, the announcement signals Singapore's intention to make its talent framework more responsive to the way senior investment professionals are compensated.
3. Singapore and Hong Kong Continue to Strengthen Their Wealth Management Ecosystems
Singapore's latest announcement comes at a time when Hong Kong is also enhancing its tax framework for funds, family offices and investment professionals.
Hong Kong already provides preferential tax treatment for qualifying carried interest under specified conditions.
In June 2026, the Hong Kong Government introduced the Inland Revenue (Amendment) (Preferential Tax Regimes forFunds, Family-owned Investment Holding Vehicles and Carried Interest) Bill 2026.
The proposed legislation seeks to enhance the preferential tax regimes applicable to privately offered funds, family-owned investment holding vehicles and carried interest.
Among other changes, Hong Kong is seeking to expand the scope of qualifying investments under its fund exemption regime and enhance its treatment of eligible carried interest.
These developments form part of Hong Kong's broader efforts to strengthen its position as an international asset and wealth management centre.
Rather than viewing the developments simply as a question of which jurisdiction offers the lowest tax rate, they demonstrate a wider regional trend.
Singapore and Hong Kong are increasingly competing not only for assets, but also for the fund managers, investment professionals and decision-making activities behind those assets.
4. Singapore's Asset Management Industry Continues to Grow
The importance of these policies becomes clearer when viewed against the size of Singapore's asset management sector.
According to MAS, Singapore's asset management industry recorded average annual growth of approximately 7.5% over the previous five years. By the end of 2025, Singapore's assets under management had reached approximately S$6.7 trillion.
MAS has also stated that the asset management industry accounts for approximately 15% of Singapore's financial sector output and 13% of financial sector employment, providing close to 25,000 jobs.
For an industry of this scale, the ability to attract and retain fund managers, Chief Investment Officers, portfolio managers and other senior investment professionals can have a broader impact on Singapore's financial ecosystem. The latest tax and immigration measures therefore go beyond attracting individual professionals. They can also influence where global asset managers choose to locate their investment teams and decision-making functions.
5. What Does This Mean for Singapore Family Offices?
The latest measures are also relevant to families that have established, or are considering establishing, a single family office in Singapore. However, an important distinction needs to be made.
Singapore already has existing fund tax incentive frameworks, including Sections 13O and 13U, which may provide tax exemptions on specified income from designated investments where the applicable conditions are satisfied.
The newly announced measure addresses something different. It concerns qualifying profit-related returns received for providing fund management services to qualifying funds.
In other words, the announcement should not be interpreted as simply providing another layer of tax exemption on all investment returns earned by a family office. Instead, its potential significance for family offices may be particularly relevant to investment talent.
As a family office grows and its investment activities become more sophisticated, it may need to recruit professionals such as:
- Chief Investment Officers
- Investment Directors
- Private Equity and Venture Capital Specialists
- Public Markets Portfolio Managers
- Alternative Investment Professionals
The compensation packages for these professionals may include both fixed remuneration and performance-linked components. Singapore's latest measures potentially address both considerations.
First, qualifying profit-related returns could potentially receive more favourable tax treatment if the final requirements are satisfied.
Second, the new ONEPass Investment Management Track could provide an additional immigration pathway for eligible senior international investment professionals.
For family offices competing for experienced investment talent from financial centres such as Hong Kong, London or New York, these changes could make Singapore's overall proposition more competitive. However, much will depend on the final eligibility requirements.
6. MAS is Looking at Capital, Not Just Tax and Talent
The third measure announced by MAS takes a different approach.
MAS plans to establish a new Hedge Fund Investment Programme. The programme is intended to invest with hedge fund managers that commit to establishing or expanding their operations in Singapore.
This adds another dimension to Singapore's asset management strategy. Tax measures address the treatment of qualifying returns. Talent measures seek to make Singapore more attractive to senior investment professionals. Investment support can potentially help attract fund managers to establish substantive operations in Singapore.
MAS has also indicated that the initiative is intended to generate positive spillovers for Singapore's wider hedge fund ecosystem, including fund service providers and prime brokerage activities. However, several important details have yet to be announced.
These include the programme's investment size, eligibility and selection criteria, allocation to individual managers and other operational requirements. Fund managers should therefore wait for further details before assessing whether they may qualify.
What Do These Changes Mean for Fund Managers and Family Offices?
Singapore's latest measures should not be viewed simply as a new “0% tax” policy.
The more important development is the combination of tax, talent and capital measures aimed at strengthening Singapore's overall asset management ecosystem.
At the same time, Hong Kong continues to enhance its own fund, family office and carried interest regimes. For fund managers and families deciding betweenSingapore, Hong Kong or another financial centre, headline tax rates are therefore only one part of the decision.
Other considerations can include:
- Fund and investment strategy
- Location of investors and investments
- Regulatory requirements
- Economic substance
- Management and decision-making functions
- Tax residency
- Location of investment professionals
- Immigration requirements
- Family wealth and succession objectives
- Longer-term plans for expansion in Asia
The appropriate jurisdiction and structure will ultimately depend on the objectives and circumstances of each fund manager, investor or family.
What Singapore's latest announcement does demonstrate is a broader shift in Asia's wealth management landscape:
The competition is no longer only about where capital is located. It is increasingly about where fund managers, investment professionals and investment decision-making activities are based.
With further details on the tax exemption,Investment Management Track and Hedge Fund Investment Programme still to come, fund managers and family offices should continue to monitor the implementation of these measures before making structural decisions.
How Lotusia Group Can Support You
If you are considering establishing or expanding a fund management company, single family office or business presence in Singapore or Hong Kong, Lotusia Group can support you in understanding the relevant corporate, immigration and business requirements.
Our team works with entrepreneurs, investors, businesses and families across multiple jurisdictions to support their establishment and expansion plans in Asia.
Speak with Lotusia Group to explore the options available for your business, investment structure or relocation plans.
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Disclaimer: This article is for general information only and does not constitute legal, tax, investment or immigration advice. The measures discussed include proposals for which detailed eligibility and implementation requirements have not yet been fully announced. Readers should refer to the latest official guidance and obtain professional advice based on their specific circumstances.
