MALAYSIA has officially gazetted the long-anticipated Single Family Office (SFO) Incentive Scheme, with the government aiming to position the country — and Forest City in particular — as a leading destination for global family wealth management and long-term capital.
Announced during a media briefing by the Securities Commission Malaysia (SC) on 6 October, the gazettement of the Income Tax (Single Family Office Incentive Scheme) Rules 2025 paves the way for the scheme’s full implementation.
It introduces a structured 20-year tax incentive framework offering capital gains tax exemptions, stamp duty relief, and a 0 percent tax rate on eligible income for qualifying SFOs.
“This formalises Malaysia’s first dedicated tax incentive for family offices and sends a clear signal to the world that we are open for long-term, purpose-driven investment,” said SC Chairman Dato’ Mohammad Faiz Azmi. “With this, we move from commitment to execution.”
Launched in September 2024 as part of the Forest City Special Financial Zone, the scheme aims to attract high-net-worth families to establish their asset management operations in Malaysia, with a dual focus on commercial competitiveness and national development.
To date, six Conditional Approvals have been granted, with indicative assets under management (AUM) totalling nearly RM400 million. A further 30 Expressions of Interest have been received, with the SC targeting RM2 billion in AUM by the end of 2026.
SFOs under the scheme are required to have at least RM30 million in AUM, rising to RM50 million after a decade.
They must also maintain a physical presence in the Forest City zone, invest a portion of their wealth locally, and meet domestic economic substance requirements such as hiring local professionals and incurring minimum operational expenditure of RM500,000 per year (rising to RM650,000 after 10 years).
The scheme offers a powerful incentive for SFOs to support national priorities. Investments in designated “Promoted Sectors” — including the New Industrial Master Plan 2030, the Johor–Singapore Special Economic Zone, sustainability-linked funds, waqf initiatives, and digital financing platforms — are granted a 1.5 times multiplier for calculating AUM.
“This is a partnership between generational family wealth and Malaysia’s economic vision — prosperity today, sustainability tomorrow,” said Faiz.
The SC has also set up a one-stop coordination centre to streamline approvals, ease market entry, and reduce regulatory friction for families and advisers. Additionally, a dedicated visa track for SFO-linked personnel has been introduced, catering to international investors seeking residency.
“The clarity and predictability offered by this framework, combined with Malaysia’s cost competitiveness and robust legal infrastructure, make us a compelling option for Asian and Middle Eastern families looking to establish regional footholds,” Faiz added.
International outreach — including recent engagements in Taiwan and Oman — has helped boost awareness and generate traction. The SC plans to expand its Family Office Summit and publish a regulatory guide to further assist families navigating the ecosystem.
With the scheme now fully operational, Malaysia joins a growing list of jurisdictions competing for global family office flows — but positions itself uniquely by tying wealth management incentives to national impact. - October 6, 2025
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