How Singapore’s Variable Capital Company Structure Works for High Net Worth Investors
An efficient, flexible fund vehicle designed for fund managers, family offices, and sophisticated investors.
You don’t need to be based in Singapore to benefit from the Variable Capital Company (VCC) framework. Fund managers and family offices across South East Asia, Australia and around the globe are structuring or redomiciling funds in Singapore to take advantage of its regulatory clarity, tax incentives, and investor trust.
What Is a Variable Capital Company?
A Variable Capital Company (VCC) is a regulated Singapore fund structure that offers fund managers and investors an efficient, flexible, and confidential way to manage capital.
Established under the Monetary Authority of Singapore (MAS) framework, the VCC structure supports:
• Standalone funds with a single investment strategy, or
• Umbrella funds with multiple segregated sub-funds, each with its own assets, liabilities, and investor base.
Designed to support both open-ended and closed-ended funds.
Why Consider a Singapore VCC?
Key benefits of the VCC structure: |
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Segregated sub-funds |
Each sub-fund is legally ring-fenced, liabilities of one do not affect another |
| Operational efficiency |
Share service providers and save on costs across sub-funds |
| Confidentiality |
Shareholder registers and financials are not publicly disclosed |
| Flexible capital base | Capital equals net assets allowing redemptions and distributions without cumbersome legal processes |
| MAS-backed tax incentives | May qualify for Section 13O or 13U schemes (conditions apply)1 |
| Redomiciliation-friendly | Foreign funds can move their domicile to Singapore using the VCC structure |
Do I Need to Be Based in Singapore to use a VCC?
No, you don’t need to be a Singapore resident or operate from Singapore to benefit from a VCC.
The VCC framework is designed to attract both local and foreign fund managers, family offices, and institutional investors. Many global firms use Singapore’s stable legal and regulatory environment to structure funds efficiently for global investor participation.
As a licensed fund manager at Aura, we support clients across Australia, Southeast Asia, and globally via an existing umbrella VCC. This means we can create multiple sub-funds that are segregated from our other VCC sub-funds.
Key reasons non-Singapore-based investors use a VCC:
Redomicile funds from other jurisdictions to Singapore
Launch new strategies under a regulated Singapore umbrella
Access MAS tax incentives (13O/13U) through a licensed local manager
Distribute returns efficiently across borders with DTA coverage
Who Uses the VCC Structure?
The Singapore VCC is used by:
• Family offices consolidating investments in a cost-efficient vehicle
• Accredited and institutional investors looking for regulated exposure to Asian and global markets
• Fund managers seeking scalable, multi-strategy platforms
• Private credit and venture capital funds seeking tax efficiency and fund segregation
Aura Group enables qualified investors to access sub-funds managed under our VCC platform, tailored to distinct strategies and supported by licensed professionals.
Tax and Regulatory Advantages
Singapore VCCs benefit from a single-tier corporate tax regime and are treated as one entity for tax filing purposes. With the appropriate structure, VCCs may qualify for:
MAS 13O / 13U tax exemption schemes
Access to over 100 Double Taxation Agreements (DTAs)
No tax on dividends under Singapore law
No tax on dividends under Singapore law
How Is a VCC Governed?
To be eligible for the VCC framework, certain conditions must be met:
- Managed by a Singapore-based, MAS-licensed or registered fund manager (e.g. Aura Group)
- One Singapore-resident director (non-authorised) or three (authorised schemes)
- Singapore registered office and company secretary
- Audited financials under IFRS, Singapore FRS or US GAAP
- VCC constitution and shareholder registry are not publicly disclosed
The fund manager may delegate operational activities to regulated sub-managers while retaining oversight.
Family Offices and VCCs
Singapore VCCs are increasingly used by single family offices (SFOs) as an alternative to bespoke fund set-ups. Using the VCC structure:
• A dedicated sub-fund can be established for the family office
• Assets can be contributed in specie (without cash conversion)
• The structure enables control, privacy, and tailored governance
• SFOs may benefit from the same 13O / 13U tax incentives as fund managers
Standalone
VCC
→
- One fund, one strategy
- Direct exposure, efficient compliance
- Often used for focused mandates or smaller pools of capital
Umbrella VCC with Sub-Funds
→
- Multiple sub-funds under one legal entity
- Each strategy has separate assets, liabilities, and investors
- Ideal for managers running multiple mandates or pooling investor segments
How Do I Set Up a VCC? Next Steps for Fund Managers and Investors
Setting up or accessing a VCC fund structure involves a few key steps, depending on your needs and investor type:
- Determine your structure needs
Will your VCC be standalone or umbrella-based? What strategies or assets will it hold? Are you redomiciling an existing fund? - Partner with a licensed Singapore-based fund manager
To qualify for the VCC regime and related tax incentives, the fund must be managed by a regulated fund manager licensed or registered with MAS. - Establish the VCC entity
Aura can assist in coordinating the fund’s legal setup, sub-fund configuration, and onboarding with regulators and administrators. - Apply for tax incentive scheme (if applicable)
If eligible, the fund can apply for the Section 13O or 13U incentive schemes¹, which may exempt specified income from tax in Singapore. - Launch and manage
Once established, the VCC structure operates like a standard fund, with audited financials, board governance, and ongoing reporting as required.
How Aura Can Help
As a licensed and MAS-regulated fund manager, Aura Group enables sophisticated investors and fund sponsors to access the VCC framework efficiently, compliantly, and with confidence.
Our team supports:- Setup of standalone or umbrella VCC entities
- Onboarding and ongoing fund administration
- Tax incentive application guidance
- Strategy structuring across private credit, VC, or bespoke mandates
- White-label or co-managed sub-funds for family offices or institutional investors
Whether you’re exploring fund structuring for the first time or seeking to optimise your existing vehicle, Aura can provide a turnkey solution backed by regulatory expertise and deep investment experience.
Aura Group is licensed by the MAS to manage funds under the VCC regime. Our platform allows:
- Efficient onboarding of accredited and institutional investors
- Launch of new sub-funds under an umbrella structure
- Full support for compliance, tax reporting, audit, and governance
- Access to experienced investment teams across private credit, venture capital, and multi-asset strategies
We support fund managers, family offices, and wholesale investors seeking a sophisticated, cost-efficient, and scalable fund structure.
What is the minimum capital for a VCC?
There is no minimum paid-up capital. A VCC’s capital is equal to its net assets at any time.
Can a VCC be used by foreign investors?
Yes. Fund managers and investors based outside Singapore can use the VCC regime by partnering with a locally licensed manager, such as Aura Group.
This allows global strategies to be administered and structured under Singapore’s efficient, investor-trusted framework.
Can a VCC qualify for tax exemptions?
Yes, under MAS Sections 13O or 13U, a VCC may qualify for tax exemptions on specified income if conditions are met.
What’s the difference between a VCC and a traditional fund?
A VCC allows flexible capital, private registers, and an umbrella structure, unlike unit trusts or companies that lack those advantages.
Access Available Only to Accredited or Institutional Investors
1.The Section 13O and 13U tax incentive schemes are administered by the Monetary Authority of Singapore (MAS) and are subject to specific eligibility requirements, including minimum fund size, local business spending, and the use of a Singapore-based fund manager. Approval is not automatic and must be obtained through application to MAS. Investors should seek independent tax advice tailored to their circumstances.
This information is issued by Aura Group (Singapore) Pte Ltd (UEN 201537140R) which is regulated by the Monetary Authority of Singapore (“MAS”) as a holder of a Capital Markets Services Licence.