On 19 August 2026, Monetary Authority of Singapore (MAS) has announced a package of measures aimed at strengthening Singapore's position as the leading global asset management centre.
The package comprises three key initiatives:
a. proposed tax exemption for profit-related returns derived from the provision of fund management services to qualifying funds;
b. a new MAS Hedge Fund Investment Programme aimed at co-investing with hedge fund managers; and
c. a new Investment Management Track under the Overseas Networks & Expertise (ONE) Pass framework catering to expatriates in the asset management industry based in or looking to relocate to Singapore.
Tax Exemption for Profit-related Returns
MAS and the Ministry of Finance (MOF) propose to introduce an additional tax exemption for profit-related returns earned from the provision of fund management services to funds (managed by Singapore-based managers) which are already qualified for tax exemption under Sections 13D, 13O, 13OA, 13U, and 13V of the Income Tax Act 1947.1
Under the existing tax exemption initiative, the qualifying funds are required to satisfy certain economic substance requirements, including, inter alia, minimum headcount and minimum local business spending (for onshore domiciled funds).
The proposed tax exemption, which will be designed to accommodate prevailing fund structures adopted and operated in the market, will apply to qualifying profit-related returns received under such fund arrangements, where corporate entities, partnerships, or individuals receive, directly or indirectly, a contractual share of a qualifying fund's profits in consideration for fund management services provided.
The proposed tax exemption is expected to take effect from the Year of Assessment 2027 when the Inland Revenue Authority of Singapore assesses taxes payable for profits or income for the year of 2026 (i.e. from 1 January to 31 December 2026). Further details will be set out in the Budget Statement for 2027, which is expected to be delivered in February 2027.2
MAS Hedge Fund Investment Programme
In addition, MAS will launch a new Hedge Fund Investment Programme to invest alongside hedge fund managers that are committed to establishing or expanding their presence in Singapore.
The programme is expected to enhance Singapore’s investment funds ecosystem, including ancillary service providers, building on the momentum generated by the S$6.5 billion Equity Market Development Programme introduced last year.
Further details of the programme will be announced in due course.3
ONE Pass Investment Management Track
Furthermore, MAS and the Ministry of Manpower (MOM) propose to introduce a new Investment Management Track (“IM Track”) under the ONE Pass framework, targeted at global investment leaders and senior investment professionals who have made, or have the potential to make, significant contributions to Singapore’s asset management industry.
The current ONE Pass framework requires an applicant to demonstrate a historic (over the last 12 months) or prospective fixed monthly salary of S$30,000. Fixed monthly salary does not include performance-related bonuses or commissions. Applicants must also show current or prospective employment with an established company, measured by market capitalisation (of at least US$500 million) or annual revenue (of at least US$200 million).
Under the proposed ONE Pass (IM Track), assessment of salaries may be refined to better reflect prevailing compensation practices within the investment management industry, including recognition of income linked to investment returns and fund performance. MOM is expected to announce further details in due course.
Potentially indicative of the new IM Track requirements, MOM has earlier announced a ONE Pass (AI and Tech Track) to be launched in January 2027. Under this track, stock options and shares would be considered when evaluating whether the S$30,000 salary requirement has been met, provided the fixed monthly salary is at least S$22,500. Companies will also be considered established if they have at least US$500 million in assets under management.
Key Takeaway
These measures are welcome developments that underscore Singapore's commitment to enhancing its position as a leading global asset management hub and anchoring its role in the Asia-Pacific region. These initiatives when implemented in their full and final form, are expected to significantly deepen the attractiveness of Singapore's fund management sector and support the continued growth of the broader investment ecosystem in the region. Industry participants should closely monitor further announcements from MAS, MOF and MOM, and consider the potential implications and necessary next steps to scale up in their adoption of these developments in their business and operational framework.
Disclaimer: We do not advise on tax matters. Please note that this update summary is not intended to be nor should it be construed as tax advice. We work with tax advisers to advise on structuring, fund documentation and employment arrangements.
1 Sections 13D, 13O, 13OA, 13U, and 13V of the Income Tax Act 1947 respectively provide tax exemption for the income of: (a) prescribed persons arising from funds managed by fund manager in Singapore (i.e., offshore funds); (b) company incorporated and resident in Singapore arising from funds managed by fund manager in Singapore (i.e., onshore funds); (c) partners of limited partnership arising from funds managed by fund manager in Singapore; (d) funds managed by fund manager in Singapore (i.e., master-feeder funds, and master funds and special purpose vehicles); and (e) prescribed sovereign fund entity, approved foreign government-owned entity, and prescribed or approved international organisation.
2 Doorstep interview with the media on 19 August 2026 of Mr. Chee Hong Tat, the Minister for National Development and the Deputy Chairman of MAS.
3 See footnote 2 above.
