Why Singapore’s Single-Family Offices (SFOs) are now becoming so Hugely Popular?

Singapore’s origin as a financial hub can be traced back to the British colonial time and the sea city in recent years has attracted many tourists and wealthy individuals to its shore for anchoring their businesses and establishing their families.

Why Singapore’s Single-Family Offices (SFOs) are now becoming so Hugely Popular?

Singapore’s origin as a financial hub can be traced back to the British colonial time and the sea city in recent years has attracted many tourists and wealthy individuals to its shore for anchoring their businesses and establishing their families.

The country has demonstrated significant resilience in financial sectors amidst the covid 19 pandemics and performed better than many of its Asian peers by registering new Company Formation in Singapore.

Individual wealth and private capital have grown significantly over the past decade and Singapore has witnessed a surge in Single-Family Offices (SFOs) growing fivefold over the past couple of years. As confirmed by the Monetary Authority of Singapore (MAS) the SFOs are neither registered nor licensed entities and as of December 2020, there were some 400 SFOs in Singapore with an estimated asset of USD 20 billion.

The Securities and Futures Act does not explicitly define the term ‘single family office.’ However, according to MAS, it generally pertains to an entity managing assets for a family, wholly owned or controlled by its members.

An SFO typically engages in diverse activities to oversee a family’s assets daily. These activities encompass investment management, consolidating family accounts, and handling tax filings.

Single-family offices commonly hire small teams of trusted advisors and investment experts. Additionally, they create indirect employment in Singapore by engaging external finance and tax professionals for guidance on wealth planning and operational concerns.

What are Single Family Offices?

SFO Incorporation

Setting up an SFO in Singapore is mostly simple and straightforward however corporate service providers with adequate fund management and administration expertise often become the necessity for effective SFO operations who can help evaluate ongoing NAVs and performance about other asset classes, identify annual audit and exemption requirements, choose annual and semi-annual financial reporting, register with ACRA, engage a company secretary and appoint a nominee shareholder for signing company’s constitution.

Business Form

An SFO structure normally involves a holding company or a trust directly owning both the SFO and the fund entity as assets. Single-family offices are normally formed by wealthy families desirous to manage and control their finances, businesses and various aspects of their lives and each beneficiary is a connected person to the settlers of that trust or a charity.

More About Single-Family Offices

Single Family Offices - Guide

Explore the reasons for the fivefold growth of Single-Family Offices (SFOs) in Singapore over the past couple of years
Discover the Business form of SFO’s and how it is incorporated
Analyse the legal and tax environment in Singapore which makes it a preferred destination for establishing an SFO

How can IMC help?

As a complete corporate business solutions provider, we have the expertise to support family offices and help HNWIs their families to use Singapore as their base to manage their wealth.

Activities carried out by SFOs

Technologies usually outsourced except for the handling of social media.

Bookkeeping, accounting, budgeting and cash flow planning are often outsourced to accounting services in Singapore.

Tax and wealth planning, only regulatory compliance is done in-house while tax planning is outsourced.

Operations except hiring and employment are usually managed by external services.

Legal services are outsourced.

Family governance, education and succession planning are mostly outsourced.

Charitable services are managed by external sources.

Risk management about fraud and data theft, insurance, managed both in-house and by external agencies.

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