By The HelloHQ team

Keeping Your 13O or 13U Incentive in Force

The conditions a Singapore single-family-office fund must meet to keep its 13O or 13U tax exemption, when each one is tested under MAS's August 2026 rules, and what happens if one is missed.

A fund with a 13O or 13U award keeps its tax exemption only for the years in which it meets the scheme's conditions. This guide sets out those conditions for single-family-office funds, when each is tested, and what happens if one is missed.

It reflects the Monetary Authority of Singapore's (MAS) circular of 31 July 2026, which applies to new awards from 1 August 2026. Section 13OA, in force since January 2025, extends 13O to Singapore limited partnerships on the same terms.

What is checked, and when

Most conditions are now tested at application and then on the last day of each financial year. A few must hold throughout the year.

What MAS checks, and whenFour columns. At application: the minimum assets and the investment team, which may be one person short. Throughout the year: investment professionals in post, a private banking account with an MAS-licensed institution, and management by the family office in Singapore. At each year-end: assets above the minimum, local spending for the fund's band, and local investment of the lower of 10% of assets or S$10 million. Within four months of year-end: the Annual Declaration to MAS.AtapplicationS$20m (13O)or S$50m(13U) indesignatedinvestmentsInvestmentteam, oneperson shortallowedThroughoutthe yearInvestmentprofessionalsin postPrivatebankingaccount inSingaporeManaged bythe familyoffice inSingaporeAt eachyear-endAssets abovethe minimumLocalspending forthe bandLocalinvestment:10% or S$10mWithin 4monthsAnnualDeclarationto MAS
Single-family-office funds, awards from 1 August 2026. Source: MAS FDD Cir 05/2026.
Condition 13O / 13OA 13U
Minimum assets in designated investments S$20 million S$50 million
Investment professionals 2, at least 1 not a family member 3, at least 1 not a family member
Local investment Lower of 10% of assets or S$10 million Same, across the whole structure

Who counts as an investment professional

A portfolio manager, research analyst or trader who:

  • is a Singapore tax resident,
  • is paid more than S$3,500 a month, and
  • spends more than half of their time on investment work.

Operations, finance, legal and tax roles do not count. A fund may apply one person short. The last hire must be in place by the end of the first year of assessment; if not, the award is revoked from its start date.

Local spending

The amount depends on the fund's assets at year-end.

Minimum local spending by assets at year-endThree bars. Assets under S$250 million: S$200,000. S$250 million to under S$2 billion: S$500,000. S$2 billion or more: S$1,000,000.S$200,000Under S$250mS$500,000S$250m to S$2bnS$1,000,000S$2bn or more
Of which local business spending must be at least S$200,000, S$300,000 and S$500,000 respectively. The rest may be eligible donations to Singapore charities, or grants to blended-finance instruments, which count at twice their amount. Source: MAS FDD Cir 05/2026.

Local business spending means operating costs paid to parties in Singapore. Taxes, penalties and financing costs do not count. Because the band is set by assets at year-end, a rise late in the year can move a fund into a higher band.

Local investment

At year-end, the fund must hold at least the lower of 10% of its assets or S$10 million in qualifying investments:

  • investments listed on approved exchanges;
  • investments distributed by MAS-licensed institutions in Singapore;
  • unlisted Singapore operating companies with a substantive presence in Singapore.

Some count at twice their value: equities on approved exchanges, funds investing mainly in Singapore-listed equities, blended-finance instruments, and qualifying unlisted Singapore companies. The first test is at the end of the first full financial year after the award starts.

The first two years

The sequence below applies to an award that starts part-way through a financial year. MAS's circular uses the example of an award starting on 1 August with a 31 December year-end: the team must be complete by that first 31 December, and the first local investment test falls on the following 31 December.

Key dates in the first two years of an awardAt the award start, the team may be one person short. At the end of the first financial year, the team must be complete and assets and spending are tested. Four months later, the first Annual Declaration is due. At the end of the first full financial year, the first local investment test applies. Four months later, the next Annual Declaration is due.Award startAward startsThe team may be one person short.End of first yearTeam must be completeAssets and spending tested.+4 monthsFirst Annual Declaration dueEnd of first fullyearFirst local investment testAssets and spending tested again.+4 monthsNext Annual Declaration due
Relative to the fund's financial year. The Annual Declaration is due within four months of each year-end.

If a condition is missed

What happens at each year-endAt the financial year-end, MAS's conditions are assessed. If all are met, the fund has the exemption for that year. If an economic condition is missed, the fund has no exemption for that year, and it returns in any later year in which all conditions are met.Financial year-endAssets, spending and local investmentassessedMetAll conditions metExemption for that yearMissedA condition missedNo exemption for that year;it can return in a later year
Exceptions: missing the deadline to complete the investment team revokes the award from its start date. Failing non-economic conditions, such as not providing documents, or a serious offence can lead to revocation. A late Annual Declaration means no exemption for that year.

MAS may ask for evidence, such as CPF statements, employment passes or an auditor's certification. The fund must also tell MAS about changes in its investment strategy, owners, directors or investment professionals.

Practical steps

  1. Put each year-end and declaration deadline in the calendar when the award starts.
  2. Check the investment team against the MAS definition, not job titles.
  3. Forecast year-end assets each quarter, against both the minimum and the spending bands.
  4. Plan local investment before the last month of the year.
  5. Keep payroll, spending and position records as they are created.
  6. For awards approved before August 2026, check the transitional conditions in your award letter.

What we could not confirm

This guide is based on MAS's circular FDD Cir 05/2026 of 31 July 2026 and MAS's family-office scheme page as updated on 22 September 2026. We did not read the Income Tax Act sections or IRAS guidance directly. Each award letter sets out the conditions for that fund and takes precedence. Awards approved before 1 August 2026 follow transitional conditions that depend on when the fund applied. Singapore's separate licensing framework for family offices, in force from 15 June 2026, has its own annual return, which this guide does not cover. This is education, not legal or tax advice.

Sources

Topics

Family offices Singapore

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