Section 13O and 13U: eligibility and operating requirements
Compare fund domicile, AUM, investment professionals and local spending, with separate conditions for commercial funds and single family offices.
Sections 13O and 13U exempt qualifying income from designated investments, subject to the relevant conditions. Section 13O applies to resident funds; Section 13U accommodates qualifying onshore and offshore structures. Assess the commercial-fund or single-family-office track before comparing AUM, personnel and spending.
This page is part of the Singapore fund tax incentives hub. Most managers pair either scheme with a VCC; family offices follow the same logic — see family office structures.
Update — August 2026: MAS Circular FDD Cir 05/2026 (31 July 2026) now formally separates the commercial (non-SFO) and family-office (SFO) condition sets under sections 13O, 13OA and 13U — different minimums (S$5M vs S$20M at 13O), different spending tiers, and a capital deployment requirement that applies to SFO funds only. Our full two-track breakdown.
13O, 13OA, 13U and 13D: key facts, with sources
The conditions below are linked to their supporting circulars or provisions. Commercial funds and single family offices are subject to different requirements.
- Two tracks under one statute
- Since FDD Cir 05/2026, the 13O/13OA/13U conditions differ by who manages the fund: a commercial (non-SFO) track for funds under a licensed manager, and a single-family-office track for family-managed exempt offices. Every threshold below belongs to a track. Source: MAS FDD Cir 05/2026.
- 13O and 13OA minimum
- Non-SFO: S$5 million in designated investments at application, with no annual re-test (the year-end test introduced on 1 January 2025 was removed retroactively). SFO: S$20 million at application and at the end of every basis period. Source: MAS FDD Cir 05/2026; 5 July 2023 SFO conditions.
- 13U minimum
- S$50 million in designated investments on both tracks, assessed for the whole structure (master-feeder and SPVs together); re-tested yearly on the SFO track only. Source: MAS FDD Cir 05/2026.
- How the minimum is measured
- Gross value of designated investments — listed and unlisted shares, bonds, fund units, derivatives, bank deposits, non-Singapore real estate, certain commodities; loans taken to finance them, including shareholder loans, are not deducted; Singapore property is excluded and, for SFOs, capital-deployment assets sit outside the minimum. Source: Income Tax (Exemption of Income of Prescribed Persons Arising from Funds Managed by Fund Manager in Singapore) Regulations; 2025 amendments.
- Investment professionals
- 13O/13OA: at least two qualifying professionals (at the manager on the non-SFO track, enforced from YA 2028; at the SFO with at least one non-family member on the SFO track). 13U: at least three. Singapore tax-resident, above the monthly salary floor, substantially engaged in fund management. Source: MAS FDD Cir 05/2026.
- Local spending
- Non-SFO: tiered local business spending of S$200,000 / S$300,000 / S$500,000 by AUM band, with a transitional S$200,000 total-spending test until YA 2028. SFO: S$200,000 / S$500,000 / S$1 million by AUM band, with donation top-ups above hard floors. Source: MAS FDD Cir 05/2026.
- Capital deployment requirement
- SFO track only: each year the lower of 10% of AUM or S$10 million must be invested in specified Singapore-linked assets, some categories counting at a multiple. Commercial funds have no deployment requirement. Source: MAS FDD Cir 05/2026; MAS SFO FAQs.
- Private-banking account
- SFO funds must hold a private-banking account with an MAS-licensed bank at application and throughout the award; it is not a condition on the commercial track. Source: MAS SFO FAQs.
- 13D, the offshore scheme
- No minimum fund size and no MAS application; the Singapore manager must employ at least one qualifying investment professional from the financial year ending 2027. Source: Income Tax Act 1947, s 13D; 2025 amendments.
- Closed-end election
- A drawdown fund may enter on total committed capital, called and undrawn, and faces no ongoing size test; local spending is waived from year 11; the election is irrevocable and the award ends at the close of the divestment phase or year 20. Source: MAS FDD Cir 05/2026.
- The 30/50 investor test
- For 13O, 13OA and 13D funds: with fewer than ten investors no Singapore-resident company may hold more than 30%; with ten or more, 50%. A breach is penalised on the investor, not the fund. 13U funds are exempt from the test. Source: Income Tax Act 1947.
- Beyond income tax
- Qualifying funds recover GST on Singapore expenses at a fixed annual rate under the fund GST remission, and receive withholding-tax exemption on qualifying payments. Source: IRAS.
- What a missed year costs
- On the SFO track, falling below the minimum or a spending tier at year-end loses the exemption for that year of assessment, not the award; on the commercial track there is no ongoing size test after entry. Source: MAS FDD Cir 05/2026.
- Award vintages
- Conditions bind by the date of the award: pre-18 April 2022, 18 April 2022, 5 July 2023 and 1 August 2026 SFO rulebooks coexist; new applicants clear the current bar at application, older awards keep theirs. Source: MAS FDD Cir 05/2026.
13O vs 13U: the full comparison
Assess the comparison by fund type and award date. Commercial-fund conditions should be read separately from the single-family-office requirements, and later amendments may supersede earlier figures.
| Feature | Section 13O (Onshore) | Section 13U (Enhanced Tier) |
|---|---|---|
| Best for | Smaller onshore funds, single-family offices | Larger funds, multi-family offices, institutional mandates |
| Minimum AUM | S$5M non-SFO / S$20M SFO reference thresholds; confirm the applicable measurement rules | S$50M reference threshold; confirm the applicable measurement rules |
| Upper AUM limit | No upper limit stated; moving to 13U requires a separate assessment | None |
| Investment professionals | 2 qualifying professionals; family relationship conditions depend on track | 3 qualifying professionals; family relationship conditions depend on track |
| Fund domicile | Onshore (Singapore) | Onshore & offshore |
| Local business spending | Published tier reference: below S$250M → S$200k; S$250M–2B → S$300k; above S$2B → S$500k. Confirm track, award date and boundary treatment before use. | |
| MAS application | Required | Required |
| AUM test timing | Depends on track, award date and applicable amendments | Depends on track, award date and applicable amendments |
| Typical run cost | Lower (smaller team) | Higher (larger team, more spend) |
| Investor perception | Solid for family/private capital | Preferred / expected by institutional LPs |
Which one do I qualify for?
Assess the applicable track before comparing AUM and staffing requirements:
- Under S$5M AUM: assess the relevant entry threshold and any applicable transitional provisions before assuming eligibility.
- S$5M–S$50M and two investment professionals: review 13O on the appropriate track. These figures alone do not establish eligibility.
- S$50M+ and three investment professionals: review 13U, including the applicable fund, manager and spending conditions.
- Singapore limited partnership: use Section 13OA.
- Purely offshore vehicle managed from Singapore: look at Section 13D.
As a quick decision matrix:
| Your situation | Scheme to assess | What you must clear |
|---|---|---|
| Singapore company / VCC, S$5M–S$50M AUM, 2 investment pros | 13O | Confirm non-SFO or SFO track first: S$5M and S$20M are different 13O reference thresholds. Personnel, measurement timing and local spending require a track-specific review. |
| Singapore or offshore fund, S$50M+ AUM, institutional investors | 13U | S$50M reference threshold and 3 qualifying professionals; confirm track-specific measurement, personnel and spending conditions |
| Singapore limited partnership | 13OA | 13O conditions applied at the LP level |
| Purely offshore vehicle, managed from Singapore | 13D | No minimum AUM · ≥1 IP from FY-end 2027 · no MAS application |
| Under S$5M AUM today | Requires assessment | Check the applicable entry conditions and transition provisions before applying |
The eligibility checker organises structure, AUM, staffing and investor information for an initial review. It does not determine eligibility or replace the current conditions in the fund’s award.
Can I start on 13O and upgrade to 13U later?
Yes, and many do. A common path is launching under 13O, then applying afresh to MAS for an Enhanced Tier award once AUM crosses S$50M and the third investment professional is hired. A VCC umbrella makes this cleaner, because new sub-funds can be added under the same award. We cover the mechanics in how to apply via MAS and the substance rules in economic substance & 2025–2027 changes.
Assess the applicable incentive
Use the 13O/13U eligibility checker to organise your requirements, then request an introduction to a Singapore fund-services provider for an application review.
Check my eligibility →Frequently asked questions
What is the main difference between 13O and 13U?
Fund residence, scale and the applicable conditions. 13O is the resident-fund scheme; 13U accommodates qualifying onshore and offshore structures. The 13O AUM figures differ between commercial funds and single family offices, so a single S$5M comparison is incomplete.
Can I start on 13O and move to 13U later?
Yes. Many managers launch under 13O and apply for an Enhanced Tier (13U) award once AUM crosses S$50M and a third investment professional is in place. You apply afresh to MAS for the 13U award.
Which scheme is cheaper to run?
Cost depends on the applicable track, team and service arrangements. Compare the required investment professionals and qualifying local spending; do not assume both schemes or both tracks have identical spending conditions.
Do both schemes use the same local business spending tiers?
Do not apply one table across all funds. The S$200k, S$300k and S$500k tiers shown above are reference figures that must be checked against the relevant track, award date and current amendments.
VCC Singapore is an independent informational resource and is not a regulator, law firm or tax adviser. Tax thresholds and conditions are set by MAS/IRAS and change periodically — confirm the current figures before acting. This page is general information, not legal, tax or financial advice.