What happened
In the Budget 2027 speech on 9 October 2026, Prime Minister and Finance Minister Anwar Ibrahim said a single-family office incentive scheme would be introduced in the Forest City Special Financial Zone (SFZ) in Johor:
- 0% concessionary tax rate on qualifying income earned by eligible family offices for an initial period of 10 years, extendable to 20 years.
- Substance conditions: minimum Assets Under Management (AUM) of RM 30 million, local operating expenditure of RM 500,000 annually, and employing at least two full-time investment professionals (at least one Malaysian).
- Expansion to Multi-Family Offices (MFOs): the scheme will be expanded to multi-family offices and independent wealth managers setting up operations in the SFZ from 2027.
Why it matters
Forest City SFZ is positioning itself as a cost-effective complementary hub to Singapore's wealth management ecosystem, located just across the Second Link.
For Singapore-based family offices and wealth managers, establishing an MFO or operational subsidiary in Forest City offers access to a 0% tax rate, lower operational and staffing costs, and proximity to Malaysian and Indonesian wealth creators, especially under the broader Johor–Singapore Special Economic Zone (JS-SEZ) framework.
What to do now
- Review whether an MFO structure in Forest City SFZ could handle middle- and back-office functions or Malaysian asset portfolios for your family office.
- Assess the substance requirements against existing staff and expenditure plans.
- Monitor guidelines from the Securities Commission Malaysia and Malaysian Investment Development Authority (MIDA) regarding licensing and qualification criteria.
Key resources
General information only; not tax or legal advice.