Singapore VCC insights

VCC Grant Scheme (VCCGS) – 30% co-funding mechanics – Common mistakes and rejection reasons

By VCC Editorial Team · Published 1 October 2026

The VCC Grant Scheme co-funded 30% of qualifying work-plan expenses for VCC incorporation, up to a cap, but it has lapsed since 15 January 2025 and is no longer open to new applicants. This guide explains how the 30% co-funding mechanics worked, the mistakes that caused applications to be rejected while it was live, and what support options exist now for sponsors budgeting a new VCC.

What the VCC Grant Scheme was

The Variable Capital Companies Grant Scheme (VCCGS) was introduced by the Monetary Authority of Singapore (MAS) and the Accounting and Corporate Regulatory Authority (ACRA) on 15 January 2020 to encourage the adoption of the VCC structure in its early years. Under the scheme, the Financial Sector Development Fund co-funded 30% of qualifying expenses paid to Singapore-based service providers for eligible work performed in Singapore in connection with VCC incorporation or registration, up to a grant cap per application. The scheme’s original three-year validity period ran to 15 January 2023, and it was then extended once for a further two years to 15 January 2025, after which it was not renewed.

It is important for sponsors researching VCC costs today to understand that the VCCGS no longer applies to new incorporations. Any VCC incorporated after the scheme’s lapse date cannot claim this co-funding, regardless of how closely its structure matches the historical eligibility criteria.

Who this is relevant for now

Because the scheme has closed, this article is primarily useful to three groups: sponsors who incorporated a VCC while the scheme was live and are reconciling a historical claim, finance teams researching the history of VCC cost incentives for comparative purposes, and new sponsors who want an honest answer on whether any co-funding support currently exists before they finalise an incorporation budget.

Eligibility and requirements (historical, while the scheme was live)

While the VCCGS was open, eligible applicants were VCCs incorporated or registered in Singapore that engaged Singapore-based service providers, typically law firms, corporate secretarial firms and fund administrators, for qualifying incorporation-related work performed in Singapore. The grant did not cover work performed outside Singapore, and it did not cover ongoing running costs such as recurring fund administration or audit fees; it was specifically targeted at defraying the upfront cost of incorporation and initial structuring. Applications were made through MAS, generally after the qualifying work had been completed and invoiced, rather than as a pre-approval of future spend.

How the 30% co-funding mechanics worked: the real numbers

• Co-funding rate: 30% of qualifying expenses paid to Singapore-based service providers for eligible incorporation-related work.
• Grant cap: a maximum grant amount per qualifying application, commonly cited at up to S$30,000 under the extended scheme.
• Qualifying scope: incorporation and registration-related professional fees paid to Singapore-based providers; ongoing running costs such as annual administration, audit and custody fees were excluded.
• Validity period: original scheme from 15 January 2020 to 15 January 2023; extended once to 15 January 2025, after which the scheme lapsed and closed to new applications.
• Application timing: applications were generally made after qualifying costs had been incurred and invoiced, not as advance funding.

Step-by-step: how a historical VCCGS application worked

1. Confirm the VCC was eligible, meaning incorporated or registered in Singapore and engaging Singapore-based service providers for qualifying work.
2. Collect invoices and proof of payment for the qualifying incorporation-related professional fees.
3. Submit the grant application to MAS with supporting documentation of the qualifying expenses.
4. Await assessment and, if approved, receive the 30% co-funding amount up to the applicable cap.
5. Retain records in case of post-disbursement review, since grant schemes of this type are typically subject to audit checks on qualifying expenditure.

Common mistakes and rejection reasons (while the scheme was live)

• Claiming non-Singapore-based provider fees: work performed by, or fees paid to, providers outside Singapore did not qualify, and applicants who included such invoices had those line items rejected.
• Including ongoing running costs: applicants who bundled annual administration or audit fees into the claim, rather than limiting it to incorporation-related work, had those items excluded from the qualifying base.
• Late or incomplete documentation: missing invoices or incomplete proof of payment were a common cause of delayed or partial approval.
• Assuming automatic entitlement: some sponsors assumed the 30% co-funding applied automatically to any VCC incorporation; it required an active application and assessment, and was never a blanket entitlement.
• Applying after the scheme lapsed: the most consequential mistake today is budgeting for VCCGS co-funding on a new incorporation without first checking that the scheme is still open, since it is not.

What support exists now that the VCCGS has lapsed

With the VCCGS closed, sponsors budgeting a new VCC should plan for the full incorporation and running cost stack without assuming any direct co-funding of incorporation fees. That said, sponsors should still check current MAS schemes and initiatives for any newer or differently scoped support relevant to fund managers operating in Singapore, since incentive programmes in this space are periodically introduced, revised or replaced. Tax-based incentives for qualifying funds, such as the schemes administered under sections 13O and 13U of the Income Tax Act, remain a separate and distinct avenue from the lapsed VCCGS, and sponsors evaluating overall cost efficiency should consider these tax incentive schemes as part of the same budgeting exercise, even though they address tax treatment rather than incorporation cost.

Why the scheme mattered for early VCC adoption

When the VCC regime launched in 2020, the structure was new to the market and sponsors had little precedent to benchmark incorporation and structuring costs against. The 30% co-funding under the VCCGS materially lowered the effective cost of being an early adopter, particularly for umbrella structures where legal drafting fees for sub-fund segregation were, and remain, the largest single professional fee line. Industry commentary at the time credited the scheme with accelerating the early pipeline of VCC incorporations, since it reduced the financial risk for sponsors deciding between a Singapore VCC and an established alternative such as a Cayman exempted company structure or an Irish ICAV.

The scheme’s two extensions, first to 15 January 2023 and then to 15 January 2025, reflected a policy judgement that the VCC regime still needed cost support to compete against better-established fund domiciles while market practice, service provider capacity and precedent documentation matured. By the time the scheme lapsed, the VCC ecosystem in Singapore, administrators, auditors, custodians and law firms experienced in the structure, was substantially more developed than it had been in 2020, which is part of the policy rationale for allowing the co-funding to end rather than extending it a third time.

How sponsors should budget now that the scheme has ended

Sponsors incorporating a VCC today should treat the full incorporation and first-year running cost stack as payable in full, without discounting their budget in anticipation of a grant that is no longer available. In practice this means the all-in first-year cost of a single-fund VCC, incorporation plus the first year of administration, audit, custody and company secretary fees, should be modelled at its full value, and compared against alternative fund domiciles on that unsubsidised basis. Sponsors who are still working from older marketing materials or outdated articles that reference the VCCGS as an active scheme should disregard those figures entirely and confirm current scheme status directly against the MAS website before finalising a budget.

FAQs

Is the VCC Grant Scheme still open for new applications?
No. The VCCGS, after being extended once, lapsed on 15 January 2025 and is not currently open to new applicants.

What percentage of costs did the VCCGS co-fund while it was active?
The scheme co-funded 30% of qualifying incorporation-related expenses paid to Singapore-based service providers, up to a grant cap per application.

Did the VCCGS cover ongoing annual running costs such as audit or administration fees?
No. The scheme was scoped to incorporation and registration-related professional fees, not recurring running costs.

Can a VCC incorporated today still apply for VCCGS co-funding?
No. Since the scheme has lapsed, VCCs incorporated after 15 January 2025 cannot claim this co-funding regardless of how closely they match the historical eligibility criteria.

Are there other incentives sponsors should look at instead?
Sponsors should review current listings on the MAS schemes and initiatives page, and consider tax incentive schemes such as those under sections 13O and 13U of the Income Tax Act, which remain separate from the lapsed VCCGS and relate to tax treatment rather than incorporation cost support.

Related guides

For a view of current tax incentive programmes relevant to corporate structuring, see Raffles Corporate Services’ Regional HQ and IHQ tax incentives decision tree. For general incorporation guidance for foreign-linked entities, see Singapore Secretary Services’ Nominee director services for foreigners FAQ. For the mechanics of the 13O and 13U tax incentive schemes referenced above, see our related article on VCC 13O tax incentive: application and conditions.

For official guidance, refer to ACRA, MAS schemes and initiatives, and IRAS.

Need help with this? Call, SMS or WhatsApp +65 8501 7133, or email hello@rafflescorporateservices.com. Raffles Corporate Services works with a panel of corporate and employment law firms; this article is general information, not legal advice.