Singapore's Single-Family Offices Create Jobs Boom; Foreign Fund Inflows Rise – MAS

Editorial Staff

7 July 2023

Single-family offices that have applied for Singapore’s tax incentives employ about 1,400 local citizens and permanent residents and most of these jobs – 900 – were created in the last three years alone, official figures show.

Singapore, along with rival hubs such as Hong Kong and Dubai, has been pushing tax incentives and other regulatory changes to encourage SFOs to set up in the Asian city-state. Since 2020, the jurisdiction has also operated a variable capital company (VCC) regime to encourage wealth management business, and it is looking at an updated VCC programme to help SFOs.

According to a statement this week from Tharman Shanmugaratnam, senior minister and minister in charge of the , the roles at SFOs are “generally well-paying jobs.”

“Two-thirds of the Singaporeans and PRs employed by SFOs under the Sections 13O and 13U tax incentive schemes earned more than S$5,000 ($3.692) per month. More than 400 earned between S$2,000 and S$5,000 per month, and fewer than 50 earned less than S$2,000 per month,” the minister said in a statement on the MAS website.

However, MAS doesn’t have data on SFOs’ contributions to revenue generation or as a source of capital, but the central bank said it intends to survey the sector to capture this information.

Fund inflows
Separately, the government minister said that foreign clients’ assets under management run by Singapore’s financial organisations rose by about S$600 billion on average in 2020 and 2021.

The top-sourced foreign region for the increase in Singapore’s AuM in 2020 and 2021 were the Americas, followed by Asia-Pacific, then Europe, Thanmugaratnam said. The comments were also issued this week by the Monetary Authority of Singapore on its website.

The minister was asked in a parliamentary question about the impact of the inflow of foreign funds on Singapore’s official foreign reserves, inflation, and the private property market. The minister noted that “inflation in Singapore is being driven by tight labour market conditions and has little to do with foreign fund or capital inflows.” “Likewise, purchases by foreigners have been a low share of all private residential property transaction volume over the last three years,” the minister added.