Singapore VCC insights

SFO Fund Banking Account Condition: The Grace Period Has Ended, So What Must 13O and 13U Award Holders Show Now

By VCC Editorial Team · Published 25 October 2026 · Updated 9 November 2026

Short answer: The three months MAS allowed from 1 August 2026 have run. An existing 13O, 13OA or 13U single family office fund whose letter of award was silent on banking must now hold a banking or private banking account with an MAS-licensed financial institution, and MAS may revoke the award from the end of the grace period.

This article is general information only and is not legal, tax or investment advice. For matters needing legal advice, we work with a panel of experienced Singapore law firms.

Updated 9 November 2026: revised now that the grace period under FDD Circular 05/2026 has ended.

The SFO fund banking account condition has moved from a deadline to a compliance fact: when we first wrote about it on 25 October 2026, families with older awards still had days to open an account. This update, checked against Monetary Authority of Singapore (MAS) sources, is for a single family office (SFO) whose fund holds a section 13O, 13OA or 13U award under the Income Tax Act 1947 granted before 1 August 2026, and which now needs to know where it stands, what MAS can do, how to evidence compliance and how to repair a miss. All sources were checked on 9 November 2026.

Has the grace period for the SFO fund banking account condition ended?

Yes. The circular gave existing awards with no banking clause three months from 1 August 2026 to obtain an account, and that period has run by any reading.

The operative words sit in the banking row of the table at paragraph 4 of Annex 6B: such funds “will be provided a 3-month grace period from 1 August 2026 to obtain the banking account or private banking account, failing which the award may be revoked from the end of the grace period”. Neither the circular nor the MAS FAQs on the Schemes for Single Family Offices (last updated 14 September 2026) give a calendar end date. On our reading, three months from 1 August 2026 ended on 31 October 2026. If MAS were to read it as running to 1 November 2026, the practical position on 9 November is the same: the grace period is over.

The circular deals with one timing point expressly. Where a fund’s first basis period ending on or after 1 August 2026 ended inside the grace period, “the fund can continue to enjoy the full 3-month grace period and will only be required to comply with this condition upon the expiry of that grace period”. A fund with a 31 August or 30 September 2026 year end kept its full three months, but must now hold the account. For a 31 December year end, the first affected basis period is the year ending 31 December 2026, relevant to year of assessment (YA) 2027, and the account must be held for the rest of that period and every period after it.

Which 13O and 13U awards were covered by the grace period?

Only existing awards whose letter of award contains no banking condition. New awards never had one, and letters already requiring a private banking account simply continue.

Paragraph 4.6 of the circular moves SFO funds with existing awards under the pre-18Apr22, 18Apr22 and 5Jul23 conditions onto “a separate set of conditions with effect from the YA where the basis period ends on or after 1 August 2026, unless otherwise notified by MAS in writing”, set out in Annexes 6B (13O and 13OA) and 7B (13U). The vintages are fixed by the date of the fund’s preliminary submission, eligibility form or formal application to MAS, not by the date of approval (Annex 6B, footnotes 94 to 96).

Award position	Account required	Grace period	Stated consequence
New award approved on or after 1 August 2026	Private banking account with an MAS-licensed financial institution at application and throughout each basis period (paragraph 4.5(c); Annex 6B, paragraph 2)	None	MAS “reserves the right to revoke the award”
Existing award; letter already requires a private banking account	“the fund shall continue to be required to comply with this condition”	None	As in the letter of award, read with the Annex 13 standard terms
Existing award; letter has no banking condition	“a banking account or a private banking account with an MAS-licensed financial institution throughout the basis period”	3 months from 1 August 2026, now expired	“the award may be revoked from the end of the grace period”

Do not treat a silent letter as the end of the enquiry. Under paragraph 8.2, from 1 August 2026 the standard terms in Annex 13 apply to new and existing awards and, where an earlier letter differs, they “will be in addition to, and to the extent of any inconsistency will supersede” it, unless MAS notifies otherwise in writing. Our refreshed guide to the Section 13O conditions for a VCC family office sets the banking condition alongside the other annual tests.

Which banks and accounts satisfy the condition?

For the tax award, the account must be with an “MAS-licensed financial institution”. For a silent-letter award either an ordinary banking account or a private banking account qualifies; new awards and letters that already say so need a private banking account.

Three practical points follow. First, the condition is framed as the fund maintaining the account, so an account held only by the SFO management company does not meet it. Second, the institution must itself be licensed by MAS, which can be checked in the MAS Financial Institutions Directory; on our reading an account booked in an overseas branch of the same banking group is unlikely to satisfy “MAS-licensed”. Third, the circular does not define “private banking account”, so where that type is required, ask the bank to confirm in writing that the account sits within its private banking business.

A second, separate account rule applies under the SFO licensing exemption. The MAS FAQs on the Licensing Exemption Framework for Single Family Offices (issued 12 June 2026, updated 31 July 2026) state that “the SFO and the investment vehicle(s) it manages must each open and maintain a bank account with a MAS-licensed bank”. The two rules are easily confused.

Point	13O/13OA/13U award (FDD Cir 05/2026)	SFO licensing exemption (MAS FAQs, July 2026)
Who holds the account	The SFO fund (for 13U, at least one approved entity for new awards)	The SFO and each investment vehicle it manages
Institution	MAS-licensed financial institution	MAS-licensed bank; a foreign-incorporated vehicle may instead use a regulated bank in a jurisdiction with anti-money laundering and countering the financing of terrorism (AML/CFT) requirements consistent with Financial Action Task Force (FATF) standards
Account type	Private banking account, or for silent-letter existing awards a banking or private banking account	Bank account
Timing	Throughout the basis period; silent-letter grace period now expired	Existing SFOs: one year from 15 June 2026, to 15 June 2027

The overseas-bank alternative belongs to the licensing exemption only; nothing in the circular extends it to the tax award. One account in the fund’s own name with an MAS-licensed bank in Singapore, of the type the award requires, usually satisfies both.

What can MAS do now that the grace period has run?

For a silent-letter award with no account in place, MAS may revoke the award from the end of the grace period. The circular frames this as a power, not an automatic result.

The wording differs by branch. Paragraph 4.5(c) and Annex 6B paragraph 2 say MAS “reserves the right to revoke the award if the banking account condition is breached”. The transitional row says the award “may be revoked from the end of the grace period”. On our reading, that is a revocation running forward from the end of October 2026, not one reaching back to the award commencement date, which the circular uses expressly elsewhere (for example, for a missing second investment professional).

Do not assume the lighter consequence for economic conditions. Under paragraph 2.4, a fund that misses an economic condition loses the exemption “for that basis period” and can claim it again in a later period. Annex 6B introduces the banking requirement as applying “In addition to the economic conditions in paragraph 1”, so the circular does not treat it as one of them, and paragraph 2.4 also says MAS “reserves the right to revoke the award permanently for funds that fail to meet non-economic conditions (such as failure to provide supporting documents upon request)”. Only MAS can say how it will treat a given fund.

How should a fund evidence the banking condition in its annual filings?

Through the tax scheme’s annual declaration, supported by a file that proves the account existed throughout the basis period. Neither the circular text available to us nor the 14 September 2026 FAQs prescribe a specific banking field, so the burden is on the fund to be able to prove it when asked.

Three filings are in play, and they should tell the same story:

• The annual declaration to MAS on the fund’s compliance with the scheme conditions (referred to in footnote 10 of the circular and in Annex 7, paragraph 14). A fund that did not hold a qualifying account for part of the period should not sign a clean declaration; it should disclose the gap and its dates.
• The SFO’s annual return under the licensing exemption, due “within four months from the end of the SFO’s current financial year”, with MAS stating that “There will not be any further extension”. A specimen is in Annex 2 of the licensing FAQs.
• The SFO’s notice of commencement of business, which must include “information on the bank accounts of the SFO and its investment vehicle(s)”; MAS asks SFOs to open those accounts before filing it.

Keep, for each basis period: the letter of award and MAS correspondence, with a note of which Annex 6B or 7B branch applies; the bank’s account-opening confirmation showing the fund’s exact legal name, the account type and opening date; a dated extract from the Financial Institutions Directory; the bank’s private banking confirmation where relevant; statements showing the account open at the start, at each quarter end and at year end; board resolutions approving the account and signatories; and, for a 13U structure, a chart naming the approved entity that holds the account. Our sister firm Singapore Secretary Services can keep those minutes and registers current, and our 13O annual compliance calendar places these filings against the year-end deadlines.

What should an award holder that missed the deadline do now?

Open the account, document the timeline and tell MAS through its published channel. MAS has not published a cure procedure; the steps below are practical suggestions, not an MAS process.

1. Confirm the branch. Read the letter of award, any later MAS correspondence and paragraph 8.2 of the circular, and record whether the fund is a silent-letter award (grace period) or already bound to a private banking account (no grace period).
2. Establish the dates: when an application was made, to which institution, and what is outstanding.
3. Open, or finish opening, an account in the fund’s own name with an MAS-licensed financial institution, and obtain the bank’s dated acknowledgement of the application.
4. If onboarding has stalled, find out why. Source of wealth questions are the usual cause; our note on MAS Circular AMLD 05/2026 and source of wealth explains what banks are now asking for.
5. Write to MAS. The MAS Fund Tax Schemes for Family Offices page directs SFO fund queries not covered by the FAQs in Annexes 11 and 12 to FO_13OU@mas.gov.sg; paragraph 8.3 of the circular points general questions to the MAS feedback form. Set out the dates, the institution and the expected opening date, and keep the correspondence.
6. Reflect the gap accurately in the annual declaration for the affected basis period, and in the fund’s tax computation, with advice on the exposure if the award is revoked.
7. Once open, minute the opening date and keep the account open and active through every later basis period.

Our guide to the exempt SFO’s continuing obligations covers the licensing side.

How does a 13U structure meet the condition?

For new 13U awards, one approved entity holding a private banking account is enough. For existing 13U awards, the governing text is Annex 7B, which should be read against the letter of award.

Footnote 31 of the circular says the condition “is regarded to be met, if at least one of the approved entities within the structure owns a private banking account with an MAS-licensed financial institution at the point of application and throughout each basis period”. That matches Annex 7, paragraph 3, under which the assets under management (AUM) and spending conditions apply “at the S13U structure level as though the structure is a standalone fund vehicle”.

The text of Annex 7B could not be extracted from the published PDF on 9 November 2026, so we do not quote it and do not assume it mirrors Annex 6B word for word. The conservative course is to hold the account in the master fund or standalone 13U vehicle. Our Section 13U guide for family offices sets out the other conditions for each vintage.

Frequently asked questions

Did MAS extend the grace period?

We found no published extension on the MAS pages checked on 9 November 2026. The circular reserves MAS’s ability to notify a fund otherwise “in writing”.

Can the account be held by the SFO rather than the fund?

Not on the circular’s wording, which requires the fund to maintain it. The SFO needs its own account separately under the licensing exemption.

We opened the account on 20 November 2026. Is the award lost?

Not automatically. The circular says the award “may be revoked”. Disclose the gap to MAS, keep the bank’s dated records and take advice before signing the annual declaration for that period.

Does each special purpose vehicle in a 13U structure need its own account?

For new 13U awards, no: one approved entity is enough under footnote 31. For existing 13U awards, check Annex 7B and the letter of award.

Sources

• MAS, FDD Cir 05/2026, Tax Incentive Schemes for Funds (31 July 2026)
• MAS, Fund Tax Schemes for Family Offices
• MAS, FAQs on the Schemes for Single Family Offices (14 September 2026)
• MAS, FAQs on Licensing Exemption Framework for Single Family Offices (updated 31 July 2026)

Raffles Corporate Services helps families confirm which banking branch applies to their 13O and 13U awards, open fund-level accounts and assemble the evidence MAS can ask for, alongside VCC incorporation, family office set-up and ongoing compliance. Email hello@rafflescorporateservices.com or Call/SMS/WhatsApp +65 8501 7133, or visit Raffles Corporate Services.

Last reviewed: 9 November 2026. The Editorial Team, Variable Capital Companies Act.