What is an ultimate beneficial owner (UBO)?
An ultimate beneficial owner (UBO) is a real person who ultimately owns or controls a company, directly or through other companies, trusts or nominees. Banks identify UBOs so that a company cannot hide who stands behind it. Example (round numbers): Ana owns 60% of a holding company in Panama, which owns 50% of a trading company in Colombia. Ana indirectly owns 30% of the trading company, so a US provider applying the 25% test treats her as a beneficial owner even though her name is not on its share register.
- A UBO is always an individual, never a company.
- US rules count each individual who directly or indirectly owns 25 percent or more of a company's equity, plus one individual with significant control.
- If a trust owns 25 percent or more, the trustee is treated as the beneficial owner for the ownership test.
- OFAC's sanctions test is different: entities 50 percent or more owned by blocked persons are blocked.
- Since March 2025, US companies no longer report beneficial ownership to FinCEN, but banks still collect it.
How beneficial ownership is worked out
Under 31 CFR 1010.230, the beneficial owners of a legal entity customer are each individual who, directly or indirectly, through any contract, arrangement, understanding or relationship, owns 25 percent or more of its equity, and a single individual with significant responsibility to control, manage or direct it, such as a chief executive, chief financial officer, managing member or president. Indirect stakes are multiplied through each layer, as in the example above.
| Test | Threshold | Purpose |
|---|---|---|
| Bank customer due diligence (US) | 25% or more, direct or indirect; plus one control person | Know who owns and runs the customer |
| OFAC 50 Percent Rule | 50% or more in aggregate by blocked persons | Decide whether an entity is blocked by sanctions |
| FinCEN BOI reporting | Applies only to foreign entities registered to do business in a US state | Corporate Transparency Act filing; US companies exempt since March 2025 |
Sources: 31 CFR 1010.230; OFAC FAQ 401; FinCEN, March 2025. As published on 29 October 2026.
Where a business meets it
- Opening an account, when the provider asks for an ownership chart and IDs as part of KYB.
- Changes in ownership, which providers expect to be updated.
- Supplier checks, where a buyer looks through a supplier's owners for sanctions.
Common mistakes
- Listing only direct shareholders. Multiply stakes through each holding company.
- Forgetting the control person. Even with no 25% owner, one individual who controls the company must be named.
- Naming a nominee. A nominee shareholder is not the beneficial owner; name the person behind the arrangement.
- Not updating after a share transfer. An out-of-date chart can hold up payments during a review.
Related terms and how Helm handles it
UBO checks are part of anti-money laundering controls. Each Helm account has a named account manager, and review questions are answered in writing within one business day. See eligibility for the countries Helm serves.
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USD, EUR and GBP accounts in your company's name, with a named account manager.
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What is an ultimate beneficial owner?
The individual who ultimately owns or controls a company, directly or through other entities. It is always a person, not another company.
What percentage makes someone a beneficial owner?
For US bank due diligence, 25 percent or more of the equity, held directly or indirectly. One individual with significant control is also identified, whatever their stake.
How do you calculate indirect ownership?
Multiply the stakes through each layer. A person owning 60% of a holding company that owns 50% of the customer indirectly owns 30% of the customer.
Do US companies still file beneficial ownership reports?
No. FinCEN's March 2025 interim final rule removed the reporting requirement for companies created in the United States. Foreign companies registered to do business in a US state may still have to report.
References
- Legal Information Institute: 31 CFR 1010.230, beneficial ownership requirements for legal entity customers
- FinCEN: Customer Due Diligence final rule
- FinCEN: FinCEN removes beneficial ownership reporting requirements for US companies and US persons (21 March 2025)
- OFAC: FAQ 401, the 50 Percent Rule and indirect ownership
This guide is general information for businesses, not financial, legal or tax advice. Rules, fees and timings were checked against the sources listed on the review date and may change.