Special Purpose Vehicle in Singapore: Setup, Guide and Benefits

Singapore is known as one of the world’s most business-friendly hubs. But sometimes, a standard company structure isn’t enough. When managing high-value assets, structuring investments, or isolating financial risk, you may need a more specialised setup: the special purpose vehicle (SPV) in Singapore.

An SPV provides a clear legal separation between the parent company and the risks associated with a particular project or asset. It’s a tool that’s widely used in real estate, venture capital, and project financing. Yet, setting up and managing an SPV can feel daunting if you’re not familiar with local regulations.

This guide explains what an SPV is, why companies use it, and how to set up an SPV in Singapore. We will also mention how Wise Business can simplify financial management by helping you keep SPV finances clearly separated from the parent company’s accounts.

*This guide is for information only and does not constitute legal advice. If you’re unsure about whether SPVs apply to your business context, consult a legal professional.

Table of contents
What is an SPV in Singapore? (Special purpose vehicle explained) Why set up an SPV in Singapore? Step-by-step guide to setting up an SPV in Singapore Managing your Singapore SPV finances with Wise Business Cut hidden costs with transparent foreign exchange rates and fees Common uses of special purpose vehicles in Singapore Singapore SPV FAQs

What is an SPV in Singapore? (Special purpose vehicle explained)

A special purpose vehicle (SPV) is a separate legal entity established for a specific, defined purpose.

By design, it shields the parent company from liabilities tied to that purpose.

In Singapore, SPVs are most commonly incorporated as private limited companies under the Companies Act¹. That means they are treated as independent legal persons with their own assets, liabilities, directors, and shareholders.

In practice, an SPV is often referred to as a special purpose company. Although it typically does not have staff or conduct day-to-day operations, it plays a crucial role in holding assets, raising funds, or facilitating transactions.

Why set up a special purpose vehicle in Singapore?

Singapore SPVs aren’t just legal formalities; they’re strategic tools. Whether you’re raising funds, protecting assets, or structuring a joint venture, a special purpose vehicle gives you flexibility and protection that a standard company setup often can’t.

Risk isolation

The most common reason to set up an SPV company is to ring-fence liabilities. By separating a high-risk project into a dedicated entity, the parent company’s balance sheet and reputation remain insulated.

• This also applies in insolvency. If the SPV fails, the parent company is generally shielded from direct liability.
• From a governance perspective, this separation creates clear accounting lines, which investors and regulators tend to prefer.

Facilitating specific transactions

Complex financial transactions often become simpler when structured through a Singapore SPV. A classic example is securitisation: an operating company transfers receivables (like loans or leases) to an SPV, which then issues securities backed by those receivables. Because the assets are now legally distinct, investors gain confidence that their exposure is tied only to those assets, not the broader risks of the parent.

• In mergers and acquisitions, SPVs can hold target companies, streamlining due diligence and shielding the buyer from hidden liabilities.
• In financing deals, lenders may insist on an SPV structure to ensure repayment obligations are ring-fenced from unrelated activities.

Holding assets

An SPV is also a clean and efficient way to hold specific assets.

• Real estate: Developers often create one SPV per project. This prevents cost overruns, disputes, or environmental liabilities from spilling over into other projects or the parent company.
• Intellectual property (IP): A business might hold patents or trademarks in a separate SPV to isolate valuable IP from operational risks. This can also make licensing or sale of the IP more straightforward.
• Investment portfolios: High-value financial instruments or cross-border holdings can be consolidated under a Singapore SPV for both tax and administrative efficiency.

Joint ventures

SPVs are frequently used as joint venture vehicles. When multiple investors or companies want to collaborate, a Singapore SPV provides a neutral structure that ensures:

• Each partner’s liability is capped at their investment in the SPV.
• Governance rules are clearly set out in shareholder agreements.
• The venture can be wound up or sold independently of the partners’ other businesses. For example, two companies may form an SPV to bid on a government infrastructure tender. If the project fails, the losses stay within the SPV instead of impacting both companies’ entire balance sheets.

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Why set up an SPV in Singapore?

Beyond the structural benefits, Singapore offers strong corporate governance, investor confidence, and tax treaties that make it especially attractive for international SPVs.

➡️ For an overview of how different entities compare, check out our guide to business structures in Singapore. ⬅️

And while structure is key, financial efficiency is equally important.

An SPV often needs to move money across borders, pay investors, or hold assets in multiple currencies. Wise Business provides that backbone with a multi-currency account that keeps costs low and reporting transparent.

Take anyIP, for example.

This Singapore-based company streamlined its global operations using Wise Business, saving on international fees and scaling into new markets. While not an SPV, their story shows how the right financial infrastructure can deliver cost savings and efficiency for any business managing cross-border payments.
➡️Read how anyIP halved their time spent on payment reconciliation with Wise Business

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Step-by-step guide to setting up an SPV in Singapore

Setting up an SPV in Singapore isn’t complicated, but it does require following a clear process to stay compliant. Here’s a step-by-step guide that takes you from defining your purpose all the way to ongoing obligations².

Step 1: Define the SPV’s purpose

Clarity of purpose is the foundation of your SPV. Regulators and investors alike will expect to see a specific, narrow objective, not a broad, catch-all mandate. A clear statement of purpose helps avoid scope creep and ensures the SPV is legally defensible if ever challenged in court.

Step 2: Choose the legal structure

In Singapore, almost all SPVs are structured as private limited companies under the Companies Act. This structure is popular because:

• Liability is limited to shareholders’ capital contributions.
• The company enjoys perpetual succession, which is useful for long-term projects.
• It’s well-recognised by banks, regulators, and international investors.

Step 3: Appoint directors and shareholders

• At least one director must be a Singapore resident (citizen, PR, or valid employment pass holder).
• Shareholders can be individuals or corporations, local or foreign.
• The minimum paid-up capital is SGD 1, though some banks may require more to open an account.

Step 4: Appoint a company secretary

Every company in Singapore must appoint a qualified company secretary within six months of incorporation. The secretary ensures compliance with the Companies Act.

Step 5: Register with ACRA (Accounting and Corporate Regulatory Authority)

You’ll need to submit:

• Proposed company name
• Business activity (as per Singapore Standard Industrial Classification (SSIC) code)
• Directors’ and shareholders’ details
• Registered office address

Registration is done through BizFile+, ACRA’s online platform. See our guide on how to register a company in Singapore.

Step 6: Obtain licences (if applicable)

Certain regulated activities, such as financial services, require licences from the Monetary Authority of Singapore (MAS).

Step 7: Open a corporate bank account

To maintain the separation of SPV finances from the parent company, a dedicated account is essential. Traditional banks can be slow and often add costs through hidden currency conversion fees and exchange rate markups, as well as high charges on international transfers, making them a poor fit if your SPV deals with cross-border capital.

💡Need to pay or get paid in foreign currencies? Wise Business could be a better alternative business account as you can hold, send, receive and exchange 40+ currencies all in one place. You’ll always get the mid-market rate with low, transparent fees. Even better, you can connect Wise Business cards to your account to control team spending in real time and reduce admin.

• Hold and manage 40+ currencies for all your international transactions.
• Pay foreign currency bills and ad-hoc business travel expenses using the Wise Business card without hefty foreign transaction fees.
• Get your first Wise Business card for free when you open a Wise Business account.
• Always get the mid-market rate with transparent conversion fees starting from 0.26%.
• Seamless integrations with popular accounting software.

➡️Get started with Wise Business today

Step 8: Stay compliant

Ongoing obligations include:

• Filing annual returns with ACRA.
• Preparing financial statements in line with Singapore Financial Reporting Standards (SFRS).
• Appointing auditors, unless exempt (SMEs with revenue < SGD 10 million, assets < SGD 10 million, and <50 employees can qualify).
• Maintaining statutory registers of directors, secretaries, and members.

Non-compliance can lead to fines or the striking off of your company.

If you’re a foreigner looking to set up an SPV, you’ll also need to comply with the local director requirement.

➡️ For a full overview, check out our guide on how foreigners can start a business in Singapore. ⬅️

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Managing your Singapore SPV finances with Wise Business

Running an SPV in Singapore is about more than just incorporation; financial management is where many companies either succeed or stumble. Between cross-border payments, investor contributions, and reporting obligations, maintaining low costs and high transparency is crucial.

Cut hidden costs with transparent foreign exchange rates and fees

Traditional banks in Singapore don’t just charge conversion fees; they also build hidden markups into the exchange rate³.

That means you get less foreign currency than the real mid-market rate, and for large SPV transactions, these “invisible” costs can significantly reduce returns. With Wise Business, you always get the mid-market exchange rate — the same one you’d find on Google. And conversion fees start at just 0.26%, clearly displayed upfront⁴.

For SPVs managing foreign capital or property income, these savings compound into meaningful protection of shareholder value.

*Please see terms of use and product availability for your region or visit Wise fees and pricing for the most up-to-date pricing and fee information.

Simplify cross-border transactions

Many Singapore SPVs exist for cross-border ventures, whether it’s overseas property development, a regional joint venture, or pooling capital from international investors. That means dealing with payments in multiple currencies.

Wise Business provides you with local account details (IBAN, sort code, and routing numbers) in major currencies, including USD, GBP, EUR, AUD, and more. This means you can:

• Receive funds from international investors as if you had a local bank account in each country.
• Pay contractors, suppliers, or lenders abroad directly from your Wise account — no need to juggle multiple banking relationships.

Keep reporting and compliance effortless

SPVs are often scrutinised more closely than standard companies. Clear, auditable records are critical for:

• Annual returns to ACRA
• Financial statements prepared under SFRS
• Investor reporting and audits

Wise Business can help by:

• Offering real-time transaction visibility through the dashboard.
• Exporting downloadable, itemised statements for your accountants.
• Integrating seamlessly with tools like Xero, QuickBooks, and other accounting software.

This reduces administrative headaches and ensures that your SPV’s financials are transparent and ready for inspection at any time.

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Common uses of special purpose vehicles in Singapore

From real estate projects to venture funding and large-scale infrastructure, here are some of the most common ways businesses put a special purpose vehicle to work.

• Real estate development: Developers often set up one SPV per project. This isolates liabilities; if one project underperforms, it won’t impact the parent company or other projects.
• Venture capital funding rounds: Investors use SPVs to pool capital into a single entity, simplifying cap tables and limiting individual risk exposure.
• Project financing: Infrastructure and energy projects often rely on SPVs to raise debt and equity. The SPV structure provides lenders with assurance that risks are contained.

Singapore SPV FAQs

Are SPVs legal in Singapore?

Yes, Special Purpose Vehicles (SPVs) are completely legal and commonly utilised in Singapore. Their operation is subject to compliance with regulations set by the Accounting and Corporate Regulatory Authority (ACRA), as well as adherence to local tax legislation and financial reporting standards.

What are the risks of a poorly structured SPV?

You risk losing the very protection an SPV provides. Non-compliance with ACRA or MAS requirements can lead to penalties and reputational damage.

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Conclusion

A special purpose vehicle in Singapore is a versatile tool for risk isolation, asset holding, and structuring investments. But it must be set up and maintained carefully to deliver those benefits. Wise Business gives SPVs the financial infrastructure to operate globally with ease, helping you save on fees, streamline reporting, and stay compliant.

➡️Get started with Wise Business today

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Sources:

1. Corporate Services
2. ACRA setting up a local company
3. Singapore Business Review
4. Wise Business pricing

Sources checked on 04 September 2025