Singapore’s Monetary Authority (MAS) announced on 19 August 2026 a trio of initiatives aimed at bolstering the city‑state’s asset‑management ecosystem: a tax exemption for profit‑related fund‑management returns, a Hedge Fund Investment Programme, and a dedicated Investment Management Track within the Overseas Networks & Expertise (ONE) Pass. The measures are intended to keep Singapore competitive as global capital and talent become increasingly mobile, but detailed rules are still pending.
Tax exemption for fund‑management returns
- Scope – A tax exemption will apply to “qualifying profit‑related returns” earned from providing fund‑management services to “qualifying funds.”
- Purpose – To enhance Singapore’s attractiveness for asset‑management firms whose compensation structures rely heavily on performance‑linked returns.
- Implementation timeline – Specific eligibility criteria, thresholds and filing requirements are expected to be disclosed in the Budget 2027.
- Status – The proposal is a policy direction, not a finalized tax regime; firms should await the final regulations before planning tax strategies.
Hedge Fund Investment Programme
- Goal – To anchor leading hedge‑fund managers that commit to establishing or expanding operations in Singapore.
- Potential support – MAS may provide direct investment, though the amount, selection process and eligibility conditions have not been released.
- Strategic focus – The programme seeks to attract “higher‑value” asset‑management activity rather than merely capital inflows.
Investment Management Track under ONE Pass
- Target – Senior global investment professionals (e.g., fund managers, senior analysts).
- Framework – An extension of the existing ONE Pass, which currently allows qualifying talent to stay up to five years and work for multiple employers.
- Compensation assessment – Authorities are reviewing how to evaluate remuneration that includes performance‑based components rather than fixed salaries.
- Details pending – Precise qualification criteria and application procedures have not yet been published.
Asset‑management sector in Singapore
- Contributes roughly 15 % of the financial‑sector output and 13 % of employment.
- Assets under management have reached almost S$7 trillion.
- The industry has grown at an average 7.5 % per year over the past five years.
Minister for National Development and Deputy Chairman of MAS Chee Hong Tat emphasized that policy adjustments must reflect shifts in the global financial landscape and that Singapore does not view competition with Hong Kong as a zero‑sum game.
Regional competition
- Hong Kong is proposing tax reforms that would expand tax‑free treatment of carried interest, potentially creating a sizable effective‑tax advantage for fund managers compared with Singapore.
- The Alternative Investment Management Association warned that some hedge‑fund and private‑equity teams in Singapore are considering relocating senior staff to Hong Kong under the new tax regime.
These developments underscore a broader contest among Asian financial hubs to attract mobile fund managers, investment firms, and senior talent.
What to watch next
- Budget 2027 – Expected to contain the final rules for the tax exemption, including eligibility thresholds and compliance requirements.
- MAS announcements – Further details on the Hedge Fund Investment Programme’s funding size and selection criteria.
- ONE Pass track specifications – Clarification of qualification standards and how performance‑based compensation will be assessed.
Fund managers, family offices, and internationally mobile investment professionals should monitor these forthcoming releases to determine how the new measures may affect tax planning, relocation decisions, and talent‑acquisition strategies in Singapore.
Source article: outboundinvestment.com
