As some people might be aware, Singapore has been the leading asset management location in the Asian continent for a while now. This is why Visa Express helps to incorporate a company in Singapore. To put it simply, the funds market of Singapore is continuously changing and growing. The regulatory infrastructure here is being adapted to reflect the increasing demands of the investment sector. During March 2017, the “Monetary Authority of Singapore” made an announcement regarding the “Singapore Variable Capital Company (S-VACC).” This is a novel corporate system for investment funds. Let’s see how it impacts the investment sector of Singapore.
Why S-VACC?
One might be thinking ‘What’s the need of S-VACC in Singapore now?’ Yes, of course, there are three existing structures that are being used by the investment funds in the country. But these structures are not without limitations. In addition to the limitations, we can find that these systems lack the much-needed flexibility when it comes to investment funds. Furthermore, the strict procedures make it difficult for the investors to proceed with the capital, distribution, or accounting treatments. Thus, a new system that could surpass all these limitations was needed. It’s believed that the brand-new S-VACC would essentially do this, thereby paving the way for the development of investment grouping activities in the country.
Important Features of the Proposed System
The important features of the proposed system are as follows:
- You can enter/exit your fund at the net asset value
- The information of the shareholders is not required to be made public
- You have no obligation to make your financial statements public
- You have no obligation to proclaim the solvency before repayment or redemption of your capital
- You can distribute or repay your capital out of your net assets
- You can classify your shares as a liability and it will not affect its solvency in any way
Thus, it is expected that this novel system for investment funds will become a game-changer in the world’s fund management sector. As we all know, Singapore is already competing with deep-rooted hubs. The launch of this evolved system will make the country stronger and is sure to attract the attention of world investors.
Best Schemes to Watch
In Singapore, there are three important schemes to watch out for. They are:
- Offshore Funds Scheme:
This, which is being managed by the fund manager based in Singapore, will be exempted from tax on income from the designated investments that are got by a prescribed person. In general, your fund will qualify to be a prescribed person, if it is not a resident of Singapore and is not owned by the Singapore investors.
- Resident Fund Scheme:
This is a scheme to motivate funds to be based in the country. This scheme will exempt tax on some incomes from the designated investments.
- Enhanced Tier Scheme:
Unlike the above-mentioned schemes, this scheme does not have any restrictions on the proportion of Singapore investors in it. Also, there are only a few restrictions on the selection of fund entity
