Singapore is a renowned wealth management center which is why many high net worth individuals and companies invest in the city-state. Foreign citizens also come to Singapore for the various asset protection facilities they can benefit from. Asset protection techniques refer to strategies and policies which help individuals and companies to shield their assets against creditors and bankruptcy in Singapore. Asset protection in Singapore can be achieved through several structures, among them the most employed being trusts, foundations, limited partnerships or a combination of all three types of entities. Our lawyers in Singapore can provide you specific details about each type of asset protection structure.
There are several ways foreign and local investors and Singapore companies use in order to protect their assets against creditors. Among these are:
Real estate property developed by the Singapore HDB is protected against creditors because under the HDB Act a liquidator does not have the authority to use the property in order to pay creditors in case of bankruptcy or debt collection in Singapore. However, if the property was purchased by contracting a loan and the owner fails to pay their installments, asset protection could prove inefficient.
Any savings with the Central Provident Fund are also protected against creditors, making this assets protection technique one of the most efficient in Singapore. Life insurance policies under the Conveyancing and Law of Property Act and under the Insurance Act are protected against creditors are considered valid asset protection instruments in Singapore.
Setting up a trust in Singapore can protect one’s assets against creditors for a period of five years. In order to ensure asset protection the trust must be irrevocable, meaning the settlor cannot change their mind or be a direct beneficiary of the trust. Even if the trust is irrevocable, the trust can still take decisions with respect to investments.
For complete information about all the asset protection instruments available in the city-state you can contact our law firm in Singapore.
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