Singapore rolls out new foreign work pass track, tax exemptions for asset management industry

It has a five-year duration for first-time candidates, with subsequent renewals of up to five years. 

Currently, candidates must meet a fixed monthly salary of at least S$30,000 from one employer, or have outstanding achievements in certain sectors to be eligible. Other sources of income may be considered on a case-by-case basis.

Pass holders have the flexibility to concurrently start, operate and work for multiple companies at any one time. 

Under the new Investment Management Track, authorities may refine salary assessments to better reflect compensation structures in the industry, including returns linked to investment performance and fund outcomes.

Such returns form a significant and recurring component of compensation for those providing specialised fund management services, besides their fixed monthly salaries.

MAS and the Ministry of Finance (MOF) also plan to introduce tax exemptions for profit-related returns from fund management services provided to qualifying funds.

This tax exemption will apply to a share of investment profits earned by fund managers and investment professionals when they deliver strong returns for investors in qualifying funds. It does not apply to ordinary salaries, bonuses or other forms of employee remuneration, MAS said.

“Such funds are already required to meet economic substance requirements, including minimum headcount. This tax exemption is targeted and aimed at sharpening the global competitiveness of Singapore as an asset management hub,” the central bank said.

The tax exemption will take into account prevailing commercial fund management arrangements, and is expected to take effect from the year of assessment in 2027. Further details will be announced at Budget 2027.

In addition, MAS will introduce a new hedge fund investment programme to invest with hedge fund managers that are committed to establishing or deepening their presence in Singapore.

This programme will support the growth of Singapore’s hedge fund investment ecosystem, including ancillary service providers and prime brokerages, and anchor global and regional hedge fund managers and investment talent, MAS said.

“This set of measures builds on the industry’s positive growth momentum, and will help anchor high-value asset management activities, deepen industry capabilities and attract top asset management talent, amidst growing international competition,” the central bank added.

Asked whether the moves are in response to competition from Hong Kong, whose assets under management surged 20 per cent to a record HK$42.2 trillion (S$6.8 trillion) last year, Mr Chee said they do not see competition with Hong Kong as “zero-sum”.

“We believe that the region is big enough. There’s enough scope for both cities to grow as financial centres. We do need to take a look at what is happening in the global landscape in reviewing and adjusting our own policies. We don’t think that the competitiveness is anchored only on one factor, say tax, for example, but that is part of the overall consideration,” he said.

He added that the growth from the industry will help to “spread the gains of economic growth to a wider pool of people in our society”.

“Where the economy is able to do well and we are able to grow our economy, the amount of resources that we can then collect will then allow us to do more, to invest in our people, to invest in our infrastructure, and to be able to look after those who are from more vulnerable sectors,” he said.