Singapore Fund Tax Incentives: 13O, 13U and 13D Explained

Singapore's fund tax incentives are three schemes under the Income Tax Act — Section 13O, Section 13U and Section 13D — administered with the Monetary Authority of Singapore (MAS). Each exempts a qualifying fund's income from designated investments (dividends, interest and gains) from Singapore tax, provided the fund meets and keeps meeting conditions on AUM, investment professionals and local business spending. The exemption sits on top of the fund vehicle, so a VCC or a company can hold any of them.

This is the hub for the tax pillar. A VCC is a structure; the tax exemption is separate and optional — most managers pair the two. Below, each scheme links to a deeper guide, and the comparison, the 2025 rule changes and the application mechanics each have their own page. Start here to orient, then go deep on the scheme that fits your fund.

The three schemes at a glance

The schemes differ mainly by the fund's residence and scale. 13O is the onshore starter, 13U the institutional tier, and 13D the route for genuinely offshore vehicles:

Two more pages round out the family: Singapore limited partnerships use Section 13OA, and designated investments and specified income defines exactly which assets and income types qualify across all the schemes.

What do these schemes exempt?

All three exempt specified income — broadly dividends, interest and gains — earned on designated investments, which cover most listed and unlisted securities, bonds, derivatives and fund interests. The exemption is not automatic: you apply to MAS, MAS issues an award letter, and the exemption holds for the life of the fund only while the conditions are met every year. Income that falls outside the designated-investment list, or a year in which a condition lapses, can be taxed.

13O or 13U — which do I qualify for?

The short version: if your fund is Singapore-incorporated and under roughly S$50M, 13O is usually the starting point; at institutional scale, or where you need offshore investors or vehicles, 13U fits better and carries no investor-residency restriction. The trade-off is headcount and spend — 13U asks for at least three investment professionals and a higher commitment. The full decision tree, with worked thresholds, is in 13O vs 13U: which do I qualify for?

What changed on 1 January 2025?

The 2025 rules reset several figures that the web still gets wrong. 13O gained a hard S$5 million minimum in designated investments tested at every financial year-end, and a formal two-investment-professional rule. Local business spending moved to a tiered scale by AUM. We track the detail in the 2025 changes to 13O and 13U.

How does the exemption sit on top of a VCC?

A VCC qualifies for these incentives the same way a company does — the award attaches to the fund, not the structure. The one structural advantage: an umbrella VCC can apply at the umbrella level and have the incentive flow to its sub-funds, so a multi-strategy manager does not file a fresh application per strategy. Alongside the income-tax exemption, a qualifying VCC also picks up GST remission (recovering most GST on fund expenses, currently to 31 December 2029) and favourable stamp-duty treatment of shares issued and redeemed at NAV — both covered on the Section 13O page.

How do I apply?

Each scheme requires a formal application to MAS, before or shortly after the fund begins operating — fund and manager details, the investment professionals, and projected AUM and spending. MAS reviews and issues the award letter. The mechanics, common to 13O and 13U, are in how to apply for 13O / 13U via MAS. Family offices run the same playbook with a family-specific lens — see family office tax incentives.

Frequently asked questions

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.