Section 13D — Offshore Fund Tax Exemption
Self-assessed tax exemption on specified income earned by a non-resident fund managed by a Singapore-based fund manager. No MAS approval is needed. The scheme expires on 31 December 2029.
What 13D is
Section 13D grants Singapore-tax exemption on specified income from designated investments earned by a non-resident fund that is managed or advised by a Singapore fund manager. The classic structure is a Cayman / BVI / Bermuda segregated portfolio company (SPC) or limited partnership with the investment-management mandate run out of Singapore; non-resident individuals and qualifying trusts can also be covered.
The exemption sits alongside Singapore's broader fund-management tax framework. It exists primarily to keep offshore fund vehicles — which would otherwise face Singapore tax exposure simply because their manager is here — competitive vs offshore-domiciled alternatives.
Eligibility conditions
| Requirement | Detail |
|---|---|
| Fund residency | A non-resident individual, or a non-resident company or trust with no permanent establishment in Singapore (other than its fund manager) that does not carry on a business in Singapore — typically a Cayman, BVI or Bermuda vehicle |
| Manager | Managed or advised directly throughout each financial year by a Singapore fund management company that holds a capital markets services licence for fund management or is exempt from holding one. The fund manager must employ at least 1 qualifying investment professional from YA 2028 — a Singapore tax-resident portfolio manager, research analyst or trader engaged substantially in fund management (no salary threshold for 13D). |
| Resident investors | A resident non-individual investor may own up to 30% of a fund with fewer than 10 investors, or 50% of a fund with 10 or more; above that, a financial penalty applies to that investor's income from the fund |
| Application | No MAS application or annual declaration to MAS (self-assessed); IRAS administers the exemption |
| Not available to | Approved pension or provident funds, designated unit trusts, REITs, and companies or trusts approved under 13U |
| Scheme expiry | The 13D, 13O, 13OA and 13U schemes expire on 31 December 2029; the Government will review them before then. Funds already enjoying the exemption at that date continue for the life of the fund while they meet the conditions. |
Source: MAS Circular FDD Cir 05/2026 (31 July 2026), Annex 9. General information only, not tax or legal advice — consult a Singapore tax adviser.
Authoritative sources
- · MAS Circular FDD Cir 05/2026 — key parameters of the 13D scheme (Annex 9) and the 31 December 2029 expiry
- · Singapore Income Tax Act 1947 — Section 13D verbatim text
- · IRAS — administers the 13D tax exemption
- · MAS capital markets framework — fund manager licensing requirements
13D vs 13O vs 13U
| Criterion | 13D | 13O | 13U |
|---|---|---|---|
| Fund residency | Non-resident | Singapore-resident | Any jurisdiction |
| Typical vehicle | Cayman SPC / BVI | Singapore company (13O) or limited partnership (13OA) | Single fund or approved master-feeder / SPV structure |
| Minimum AUM | No minimum | S$20 million | S$50 million |
| MAS approval | No (self-assessed) | Yes | Yes |
| Investment professionals | Manager employs 1 from YA 2028 | 2 (≥1 non-family) | 3 (≥1 non-family) |
| Local-spending minimum | None | S$200,000 to S$1 million / year, tiered by AUM | S$200,000 to S$1 million / year, tiered by AUM |
13O and 13U figures are for single-family-office funds awarded on or after 1 August 2026; non-family-office funds have different conditions. Per MAS Circular FDD Cir 05/2026 (31 July 2026), for new single-family-office awards from 1 August 2026. Verified 14 September 2026. Always confirm specifics with qualified SG counsel.
When to use 13D
Mature offshore structures
Family already has a Cayman / BVI fund vehicle with established history. Continuing 13D treatment avoids onshoring complications.
Multi-jurisdiction estate planning
Family beneficiaries spread across countries that require non-Singapore fund domicile for treaty / succession reasons.
Net-new family-office setups
Usually prefer 13O or 13U for substance + simpler narrative + Singapore-tax integration.
Third-party fund managers
External fund managers in Singapore commonly use 13D for offshore-domiciled commingled funds. Family offices going single-family typically pick 13O/13U.
Section 13D Singapore — FAQs
What is Section 13D in Singapore?
Section 13D of the Singapore Income Tax Act grants a tax exemption on specified income from designated investments for a non-resident fund — a non-resident individual, a non-resident company, or a qualifying trust — managed or advised by a Singapore fund manager. It is self-assessed: no MAS application or approval is needed. Unlike 13O (a Singapore company or limited partnership) and 13U (an MAS-approved fund in any jurisdiction), 13D has no minimum AUM or local-spending condition.
What is "specified investment income" under 13D?
A defined list in the Income Tax Act including dividends, interest, gains on disposal of securities, derivative income, and certain alternative-investment streams. The list is not exhaustive — some asset classes (e.g. real-estate operating income) fall outside specified income and remain taxable.
Is 13D the same as the "Approved Fund Manager" tax incentive?
No. 13D is an exemption for the fund vehicle itself. The "Approved Fund Manager" or "Financial Sector Incentive — Fund Management" schemes are separate concessionary tax rates applied to the fund manager's fee income. A 13D-eligible fund can be managed by an FSI-FM-incentivised manager.
How is 13D different from 13O and 13U?
Approval and conditions. 13D is self-assessed and covers non-resident funds, typically an offshore vehicle with a Singapore manager. 13O and 13U are MAS-approved awards: for single-family-office funds, 13O needs a Singapore company or limited partnership and S$20 million of AUM, and 13U allows a fund in any jurisdiction with S$50 million; both carry investment-professional, local-spending and capital-deployment conditions. A company or trust approved under 13U cannot use 13D.
What are the 13D eligibility conditions?
(1) The fund must be a non-resident individual, or a non-resident company or trust that has no permanent establishment in Singapore other than its fund manager, does not carry on a business in Singapore, and does not hold investments transferred from a Singapore business other than on market terms; (2) Managed or advised directly throughout each financial year by a Singapore fund management company that holds a capital markets services licence for fund management or is exempt from holding one. The fund manager must employ at least 1 qualifying investment professional from YA 2028 — a Singapore tax-resident portfolio manager, research analyst or trader engaged substantially in fund management (no salary threshold for 13D). Resident non-individual investors are limited to 30% of a fund with fewer than 10 investors, or 50% of a fund with 10 or more; above that, a financial penalty applies to their income from the fund. 13D does not apply to approved pension or provident funds, designated unit trusts, REITs, or companies and trusts approved under 13U.
Does 13D apply to VCC sub-funds?
No, because a VCC is a Singapore-resident vehicle. VCCs typically use 13O or 13U (or the broader fund-management exemption regime). See /variable-capital-company-singapore for the SG-resident fund vehicle that has largely displaced new offshore structures.
Is 13D being phased out?
Not at present. The 13D, 13O, 13OA and 13U schemes expire on 31 December 2029; the Government will review them before then. Funds already enjoying the exemption at that date continue for the life of the fund while they meet the conditions. Some commentary post-2022 suggested family-office founders should prefer 13O/13U for substance reasons, but 13D continues for traditional offshore fund work.
When should a family office use 13D instead of 13O/13U?
When the family already has — or wants — an offshore (Cayman/BVI/Bermuda) fund vehicle, typically for legacy estate-planning or multi-jurisdiction reasons. Most net-new SG family-office setups in 2024–2026 use 13O or 13U for the substance benefit and simpler narrative. Mature offshore structures often retain 13D treatment.
Planning a Singapore family office?
We can introduce you to MAS-registered family-office service providers and Singapore tax/legal partners covering 13D / 13O / 13U structures. Typical client portfolio S$20M+.