Singapore plans to offer fund managers a new tax break as competition for global investment firms heats up.
The Monetary Authority of Singapore (MAS) and the Ministry of Finance plan to exempt certain profit-related returns earned from managing qualifying funds.
The exemption would apply when companies, partnerships or individuals receive a contractual share of a fund’s profits for providing fund management services.
It would not cover salaries, bonuses or other employee remuneration.
Eligible funds must qualify under existing tax exemption schemes, meet economic substance requirements such as minimum headcount and be managed by Singapore-based fund managers.
The exemption is expected to take effect from the Year of Assessment 2027.
Further details will be announced during Budget 2027.
MAS Targets Hedge Fund Managers
MAS will launch a Hedge Fund Investment Programme to invest with managers that establish or expand their presence in Singapore.
The programme aims to attract global and regional hedge fund managers and investment talent.
It will also support related businesses such as prime brokerages and other service providers. MAS will release more details at a later date.
New ONE Pass Track for Investment Professionals
MAS and the Ministry of Manpower also plan to create an Investment Management Track under the Overseas Networks and Expertise Pass framework.
The track will target global leaders and senior investment professionals who already contribute or could contribute significantly to Singapore’s asset management industry.
Authorities may refine how salaries are assessed to reflect industry compensation structures.
This could include recognising recurring returns linked to investment performance and fund outcomes alongside fixed monthly salaries.
Singapore’s asset management industry accounts for about 15% of financial sector output and 13% of its employment.
It grew by an average of 7.5% a year over the past five years to nearly S$7 trillion.
The sector employs close to 25,000 people across portfolio management, investment research, client servicing and risk management.
Local workers make up about 80% of the workforce.
Featured image: Edited by Fintech News Singapore, based on image by Hong Tat Chee, Minister for National Development via LinkedInÂ
