Aircraft Leasing Scheme (ALS) and Aircraft Investment Manager (AIM) Incentive Programs (Singapore Incentive Policies)

The Aircraft Leasing Scheme (ALS) and Aircraft Investment Manager (AIM) incentive programs launched by the Singapore Economic Development Board (EDB) aim to promote the development of the aviation finance industry and attract aircraft leasing and aviation asset management companies to establish operations in Singapore. These incentive measures help companies optimize their financial structures for aviation leasing and asset management while leveraging Singapore's financial advantages for global expansion.

1. Aircraft Leasing Scheme (ALS)

Introduction:
The Aircraft Leasing Scheme (ALS) is an incentive measure designed to attract aircraft leasing companies to conduct business in Singapore. ALS supports companies in establishing aircraft leasing operations in Singapore or expanding existing leasing activities by providing tax incentives for qualifying leasing activities.

Benefits:

Concessionary corporate income tax rate of 5% or lower for qualifying aircraft leasing income, compared to the standard corporate tax rate of 17%.
Covered activities include operating leases, finance leases of aircraft or aviation engines, and the design and management of aircraft leasing structures.
Companies can also enjoy tax exemptions on income related to leasing operations, such as maintenance fees, insurance premiums, and financing charges.

Eligibility Requirements:

Companies need to establish an aircraft leasing entity in Singapore and conduct leasing activities that fall within the ALS scope.
Companies must demonstrate their contribution to Singapore's aviation finance ecosystem, such as through the value-add effects of leasing activities or employment of local talent.

2. Aircraft Investment Manager (AIM) Incentive Program

Introduction:
The Aircraft Investment Manager (AIM) incentive program is designed specifically for investment managers or fund management companies that manage aviation assets, aiming to encourage these companies to invest in and manage aviation assets in Singapore. Through the AIM program, companies can obtain tax incentives for aviation investment management activities, thereby reducing operating costs and enhancing the overall effectiveness of aviation asset management.

Benefits:

Concessionary corporate income tax rate of 10% or lower for qualifying aircraft investment management income.
Covered activities include procurement, financing, lease management of aviation assets, and provision of advisory services for aviation investments.
Supports companies in establishing dedicated aviation investment management teams in Singapore to manage aircraft asset portfolios globally or regionally.

Eligibility Requirements:

Companies need to establish a dedicated aviation investment management department in Singapore and manage aircraft investment portfolios across multiple countries.
Companies must demonstrate the value-add effects of their projects on Singapore's financial and aircraft leasing markets, such as through bringing in capital investment, innovative aviation asset management technologies, or developing local talent.

3. Common Features of ALS and AIM Programs

Tax Incentives: Both programs reduce corporate tax burdens through lower corporate income tax rates, encouraging more companies to centralize their aviation asset management activities in Singapore.
Support for Aviation Finance Industry Development: These programs help establish Singapore's position as a global aviation leasing and finance center, attracting more aircraft leasing companies and investment managers to choose Singapore.
Promote Industry Chain Synergistic Development: ALS and AIM programs support the entire aviation finance value chain, including aircraft leasing, asset management, and financing, enhancing Singapore's competitiveness in the aviation sector.

4. Singapore's Advantages as an Aviation Finance Center

Singapore offers an excellent business environment and international financial services, providing strong support for aircraft leasing and aviation asset management. The following are Singapore's main advantages in the aviation finance sector:

Stable Legal and Regulatory Environment: Singapore's robust financial regulatory system provides a transparent legal framework for aviation leasing and asset management businesses.
Well-developed Financial Infrastructure: Singapore hosts numerous international banks and financial institutions, capable of providing comprehensive funding support for aviation finance.
Strategic Geographic Location: Singapore is centrally located in the Asia-Pacific aviation market, facilitating companies in managing and expanding aviation asset investment and leasing activities within the region.

5. Application Process

When companies apply for ALS or AIM incentives, they typically need to go through the following steps:

Submit Preliminary Application: Companies submit a business plan to the Singapore Economic Development Board (EDB), outlining their aviation leasing or asset management activities in Singapore.
Submit Detailed Business Plan: Companies need to submit a detailed business plan explaining the operating model of their leasing or investment management business, expected economic benefits, and contribution to Singapore's aviation finance industry.
EDB Review and Assessment: The Singapore Economic Development Board will evaluate the application, reviewing the company's qualifying economic activities and value-add effects.
Sign Agreement and Determine Concessionary Tax Rate: Once approved, the company will sign an agreement with EDB, determining the validity period and specific conditions of the tax incentives.

6. Business Benefits of ALS and AIM Programs

Companies can obtain significant financial and business advantages through ALS and AIM programs:

Tax incentives help reduce operating costs and enhance companies' competitiveness in the global market.
Companies can achieve centralized management and optimization of aviation assets by leveraging Singapore's financial and legal advantages.
By establishing aviation leasing and asset management businesses, Singapore companies can attract more international investment, promoting long-term industry development.

The Aircraft Leasing Scheme (ALS) and Aircraft Investment Manager (AIM) incentive programs provide strong support for companies in the aviation finance industry, attracting more aircraft leasing companies and investment managers to establish operations in Singapore. These policies not only help companies optimize their financial structures but also further consolidate Singapore's global position in the aviation finance sector. Through ALS and AIM programs, Singapore provides companies with a favorable platform for expanding business across Asia and globally.