0% Tax for Up to 20 Years? Here Is What Malaysia's Family Office Incentive Offers

Many families who have built up wealth ask the same question. How do we manage it well and pass it on to the next generation?

On 2 November 2026, the Securities Commission (SC) shared that its Single Family Office (SFO) incentive scheme had attracted about RM20.8 billion in assets by the end of September.

That is more than ten times its original RM2 billion target.

So, what is a single family office?

It is a private entity set up to manage the wealth and investments of one family. The scheme was launched in September 2024 under the Johor Forest City Financial Special Zone initiative.

Why are so many families interested?

According to the scheme, each qualifying SFO vehicle can enjoy a 0% tax rate on all its income for up to 20 years.

The condition is real presence. The family must invest, spend and hire staff locally. The SC said the aim is families that operate here, not just structures registered here.

Donations to the Iskandar Regional Development Authority (IRDA) social fund will count as local operating expenses. Newly approved families must apply for their first certification within 18 months of conditional approval.

Under Budget 2027, a family will also be able to appoint an SC certified fund manager directly, without setting up its own management company.

In simple terms, a qualifying family office can pay 0% tax on its income for up to 20 years, if the local conditions are met.

From a business perspective, this can be a meaningful tax saving for families planning long term wealth management and succession. The detailed conditions and approval process should be checked before setting one up.

For families planning how their wealth will be managed in the years ahead, it may be worth looking into whether this scheme fits their plans.

If your family is exploring a family office structure, our team can help review the tax position and handle the related company secretarial and compliance matters. We also take care of accounting, payroll, tax planning and e-stamping, so you can focus on running and growing your business. Feel free to WhatsApp us at 010-246 2151.