Is Hong Kong the Preferred Choice for Family Offices in Asia? A Comparative Analysis with Singapore

炒年糕的貓貓
Jul 16
3 min read

Updated: Jul 28

Financial Secretary Paul Chan recently revealed that the number of family offices in Hong Kong has exceeded 2,700 and is expected to rise to 3,000 in the near future, far surpassing Singapore’s approximately 2,000 family offices. Hong Kong’s rapid growth stems from its robust financial infrastructure, rigorous yet efficient regulatory system, and a diverse pool of professional talent and investment channels. This article will provide potential investors with an in-depth analysis of the developmental advantages and current landscape of family offices in Hong Kong.

The Appeal of Hong Kong for Family Offices

The Hong Kong government has recently introduced a series of innovative incentive policies, actively positioning itself as the "Asia Family Office Hub." Its core advantages include:

1. Simplified Registration

The process of establishing a family office in Hong Kong is similar to that of registering a general company, requiring only compliance with basic legal, tax, and regulatory requirements. Family offices are primarily divided into two types:

Single Family Office (SFO):

Dedicated to providing comprehensive asset management services for a single ultra-high-net-worth family. According to Hong Kong’s latest regulations, an SFO must manage at least HKD 240 million (approximately USD 30 million) in designated assets, and the family must hold at least 95% beneficial ownership of the office (this can be reduced to 75% if the remaining 25% is held by a tax-exempt charity).

Multi-Family Office (MFO):

Provides integrated services for multiple ultra-high-net-worth families. MFOs typically require licensing under the Securities and Futures Ordinance, including Type 1 (securities trading), Type 4 (securities advisory), and Type 9 (asset management) licenses. If futures or options contracts are involved, a Type 2 (futures contract trading) license is also required.

2. Tax Incentives

Hong Kong operates a two-tier profits tax system: the first HKD 2 million of profits is taxed at 8.25%, while the excess is subject to the standard rate of 16.5%. This low-tax environment provides favorable conditions for family offices.

More notably, Hong Kong has tailored tax incentives for family offices: eligible Family Investment Holding Vehicles (FIHVs) and special purpose entities can enjoy a 0% profits tax rate on qualifying transactions and incidental income (such as bond interest), provided specific conditions are met.

3. Residency and Visa Convenience

For investors considering establishing a family office in Hong Kong, the process of obtaining work visas and residency is relatively straightforward. Compared to competitors like Singapore, Hong Kong’s visa approval process is more efficient:

Work visas are typically approved in about six weeks.
Professionals in financial services (including family office staff) can obtain residency quickly through immigration pathways such as the Quality Migrant Admission Scheme (QMAS).

Hong Kong vs. Singapore: A Comparison of Family Office Ecosystems

Key Metrics	Hong Kong	Singapore
Tax Advantages	No VAT, capital gains tax, dividend tax, or estate tax; eligible investment profits are tax-exempt. Corporate tax: 8.25% on first HKD 2 million, 16.5% on excess.	Corporate tax: 17%; no capital gains or estate tax; GST rate: 9%; S13U/S13O schemes offer tax exemptions on investments.
Investment Requirements	No mandatory local investment requirements.	Must invest SGD 10 million or 10% of AUM (whichever is lower).
AUM Requirements	Minimum HKD 240 million in qualifying assets.	S13O: SGD 20 million; S13U: SGD 50 million.
Approval Process	Simple registration; no pre-approval or additional applications required.	Requires submission of S13O/S13U applications to the Monetary Authority of Singapore (MAS).
Operational Expenditure Requirements	Annual local spending of at least HKD 2 million.	Annual local business spending of at least SGD 200,000.
Staffing Requirements	At least two full-time employees (can be family members).	S13O: Two investment professionals (at least one non-family member); S13U: Three.

Conclusion

For investors planning to establish a family office in Asia, Hong Kong not only offers an international financial environment but also leverages the development opportunities of the Greater Bay Area, making it an ideal hub for wealth management and intergenerational succession. In the future, as the Hong Kong government continues to optimize the family office ecosystem, its position as Asia’s family office center will be further solidified.