Section 13O, 13U, 13D & 13OA: The 2026 Guide to Singapore Fund Tax Incentives
What each scheme exempts, the real AUM, headcount and spending numbers, which one you qualify for — and how the rules changed for 2025.
Singapore exempts qualifying fund income from tax under a family of schemes administered with the Monetary Authority of Singapore (MAS). The three that matter for most managers and family offices are Section 13O (the onshore/resident fund scheme), Section 13U (the enhanced-tier scheme for larger funds), and Section 13D (the offshore fund exemption) — plus the newer Section 13OA, which extends 13O treatment to Singapore limited partnerships. All of them sit on top of a fund vehicle such as a Variable Capital Company (VCC).
13O, 13OA, 13U and 13D: key facts, with sources
The conditions most often asked about, each with the circular or provision it rests on. Track matters: the same words mean different numbers on the commercial and family-office tracks.
- 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 or registered 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 vs 13D vs 13OA — at a glance
Sources disagree on the AUM and headcount figures because they conflate the general fund rules with the family-office route and pre- vs post-2025 changes. Here is the current position:
| Feature | Section 13O (Onshore) | Section 13U (Enhanced Tier) | Section 13D (Offshore) | Section 13OA (LPs) |
|---|---|---|---|---|
| Best for | Smaller onshore funds, single-family offices | Larger funds, multi-family offices, institutional | Offshore-structured funds with a SG manager | Singapore limited partnerships |
| Minimum AUM | S$5M designated investments (end of each FY) | S$50M at application and each FY | No minimum | Same as 13O |
| Investment professionals | ≥2 (≥1 non-family) | ≥3 (≥1 non-family) | ≥1 (from FY-end 2027) | ≥2 (at LP level) |
| Local business spending | Tiered: <S$250M → S$200k · S$250M–2B → S$300k · >S$2B → S$500k | None | Same as 13O | |
| MAS application | Yes | Yes | No | Yes |
| Fund domicile | Onshore (Singapore) | Onshore & offshore | Offshore vehicle | Singapore LP |
Which scheme do I qualify for?
The short version: if your fund is a Singapore company or VCC with around S$5M+ in designated investments and two investment professionals, you are in 13O territory. Cross S$50M with a third investment professional and 13U becomes available (and is usually preferred by institutional investors). A Singapore limited partnership uses 13OA. A purely offshore vehicle managed from Singapore looks at 13D. Use the eligibility checker below to map your specifics — it captures your structure, AUM and headcount and returns the scheme you fit plus the exact numbers you need to hit.
A worked example: what does the exemption actually save?
Numbers make the incentive concrete. Take a Singapore-incorporated VCC running a S$50 million credit and equities book that generates S$4 million of qualifying income in a year — interest, dividends and gains on designated investments. Here is the same fund taxed as an ordinary company versus exempted under 13O or 13U:
| Line | No incentive (ordinary 17% rate) | 13O / 13U exempt |
|---|---|---|
| Qualifying income from designated investments | S$4,000,000 | S$4,000,000 |
| Singapore tax on that income | S$680,000 (17%) | S$0 |
| Income retained for investors | S$3,320,000 | S$4,000,000 |
| Annual tax saved | S$680,000 | |
The S$680,000 saving comfortably outweighs the cost of meeting the conditions — the tiered S$200k–S$500k local business spending and a two-to-three person investment team are the price of admission, and most of that spending (admin, audit, tax, management fees) you would incur anyway. This is illustrative arithmetic at the headline 17% corporate rate, not a tax computation; partial exemptions, the income type and your actual cost base will move the real figure. Run your own numbers in the eligibility checker below.
Not sure which scheme fits?
Run the 13O/13U eligibility checker, then we'll connect you with a vetted Singapore fund-setup partner to file it.
Check my eligibility →What changed on 1 January 2025
MAS tightened the economic-substance conditions across 13O and 13U. The headline changes: 13O picked up a minimum-AUM test (S$5M in designated investments) and a two-investment-professional requirement where previously it had neither; local business spending moved from a flat S$200k to the tiered bands above; and the AUM test for both schemes must now be met at the end of every financial year, not just at application. Existing pre-2025 awards generally have until their financial year ending 2027 to comply. The separate VCC Grant Scheme (which co-funded incorporation costs) expired on 15 January 2025 — many competitor pages still list it as live; it is not.
How the schemes connect to the VCC
A tax incentive is not a structure — you still need a fund vehicle and a Singapore-regulated manager. Most managers pair these incentives with a VCC (often as an umbrella with ring-fenced sub-funds), managed either under their own licence or under an existing MAS-licensed fund manager. Family offices typically run the same playbook — see family office structures.
Frequently asked questions
Is VCC income really tax-free?
Qualifying income from designated investments is exempt from Singapore tax when the fund meets the conditions of 13O, 13U or 13D — not automatically. You must apply (for 13O/13U) and maintain the AUM, investment-professional and local-spending conditions each year.
What counts as "local business spending"?
Expenses paid to Singapore-based providers — fund administration, audit, tax, legal, management fees, and similar — count toward the tiered local-business-spending requirement (S$200k / S$300k / S$500k depending on AUM).
Do I need to hire investment professionals in Singapore?
Yes. 13O requires at least two and 13U at least three investment professionals who are Singapore tax-resident and earning above the MAS salary floor; at least one must be a non-family member.
Is the VCC Grant Scheme still available?
No. The VCC Grant Scheme, which co-funded up to 70% of incorporation costs (capped at S$150k) originally, then 30% (capped at S$30k) under its final 2023–2025 extension, and closed to new applications on 15 January 2025.
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.