How to Set Up a Family Office: Three Files, Not One

A family usually comes to us with one question: “Which licence do I need to set up a family office?” The honest answer is often: none. That is exactly where the trouble starts.

Most mistakes we see come from treating the family office as one package, where licence, tax status and residence permit arrive together. They don’t. They are three separate files, handled by three different authorities, with three different sets of conditions. Here is the short version for the four jurisdictions families ask about most: Switzerland, Singapore, Dubai and Hong Kong.

First, what a family office is (and isn’t)

A family office is an organisation, not a legal product you buy off the shelf. Separate three layers: the management entity, the vehicles that hold the assets, and the family members themselves. Each layer has its own rules.

1 File: Licensing

No FINMA licence if you manage only the assets of persons with whom you have family or economic ties (Financial Institutions Act, Art. 2 para. 2 let. a). But calling it an “SFO” proves nothing: the structure and the activities do. Professional trustees, on the other hand, need FINMA authorisation.
Single family offices are exempt from capital markets services licensing, subject to notifying MAS and banking with a Singapore financial institution.
Hong Kong. It depends on whether the activities are regulated, carried on as a business, and for whom. The SFC looks at substance, not labels.
Dubai (DIFC). Registration under the Family Arrangements Regulations 2023 requires an aggregate family net worth of USD 50 million. ADGM in Abu Dhabi is a separate regime.

2 File: Tax

Singapore 13O / 13U. 13O: S$20m, 2 investment professionals. 13U: S$50m, 3 investment professionals. In both, at least one professional from outside the family; local spending from S$200,000 to S$1m depending on assets; at least 10% of assets or S$10m (whichever is lower) deployed locally.
Hong Kong FIHV. HK$240m of specified assets, at least 2 full-time qualified employees in Hong Kong, HK$2m of local spending. An amendment bill is pending; it is not law yet.
UAE free zones. 0% on qualifying income, 9% on the rest. The word “foundation” does not create an exemption.
Swiss lump-sum taxation. Available in Geneva, abolished in Zurich. Not for Swiss nationals, and no gainful activity in Switzerland, so running your own family office from Geneva and claiming the lump sum do not automatically go together.
There is no “Swiss trust”. The Federal Council dropped the project in September 2023. Switzerland recognises foreign trusts; that is a different thing.

3 File: Residence

A company gives nobody a residence permit. Each family member is a separate file.

Switzerland: EU/EFTA nationals can reside without working if they have sufficient means and health insurance; for others, admission is case by case.
Singapore: Employment Pass, ONE Pass (S$30,000 a month), or the Global Investor Programme: S$200m of assets for the family office option. The S$25m figure you often read is the fund option.
Hong Kong: New Capital Investment Entrant Scheme, HK$30m. Nothing to do with the HK$240m tax threshold.
Dubai: ten-year Golden Visa from AED 2m of property, under the Dubai Land Department’s conditions.

Then check four things per person: right of entry, length of stay, conditions to keep the status, and what happens on divorce, death or a child turning eighteen.

Five mistakes we see when families set up a family office

Confusing a licensing exemption with a tax exemption.
Assuming the principal’s visa covers the spouse, adult children and staff.
Running the Singapore or Dubai entity from Geneva in practice, and losing its tax status.
Budgeting the minimum spend required by a tax scheme as if it were the real running cost.
Copying a structure from a brochure (or a chatbot) that includes a Swiss trust.

And then the 30-year question

Getting the set-up right is half the job. The other half is making sure it still works when conditions deteriorate. That is the subject of our joint report with Venture Capital Studio, click here: Family Office: The Wrong Question:

Setting up or restructuring a family office? FintechLex, Geneva, Hong Kong, London: insight@fintechlex.com