Ultimate Beneficial Ownership (UBO): What It Means for Firms

Ultimate beneficial ownership (UBO) is about answering a deceptively simple question: who really owns or controls this client? Behind a company or trust there is always a human being who ultimately benefits — and identifying that person is one of the foundations of anti-money laundering compliance. Criminals rely on opaque ownership structures to hide, so getting UBO identification right is central to keeping illicit money out of the financial system.

What is a beneficial owner?

A beneficial owner is the natural person who ultimately owns or controls a customer, or on whose behalf a transaction is being conducted. For a company, this is typically anyone who ultimately owns or controls more than 25% of the shares or voting rights, or who otherwise exercises control over the company or its management. Where no individual meets the ownership test, the senior managing officials are treated as the beneficial owners. For trusts, the settlor, trustees, beneficiaries and anyone with control are all relevant.

The 25% threshold and PSCs

In the UK, the beneficial ownership concept is mirrored in the People with Significant Control (PSC) regime. A PSC is broadly someone who holds more than 25% of shares or voting rights, has the right to appoint or remove a majority of the board, or otherwise exercises significant influence or control. Companies must identify their PSCs and report them to Companies House, where the information sits on a public register.

Why the register is changing

For years a fundamental weakness of the PSC register was that it relied on self-reported, unverified information. The Economic Crime and Corporate Transparency Act 2023 (ECCTA) is changing that. From November 2025, identity verification became mandatory for company directors and PSCs, who must now verify their identity with Companies House, with all relevant individuals connected to UK companies expected to have completed verification through 2026. Failure to comply is a criminal offence carrying penalties and filing restrictions. The reforms are designed to make the register far more reliable as a source firms can lean on.

What this means for your due diligence

Identifying beneficial owners is a required part of customer due diligence on every corporate or trust client. You must take reasonable measures to verify the identity of beneficial owners so that you are satisfied you know who they are — and you cannot simply rely on the Companies House entry without your own checks, though verified register data strengthens your position. Where ownership is complex, layered across jurisdictions, or deliberately obscured, that is a risk indicator that may call for enhanced due diligence.

Common red flags

Watch for ownership structures with no clear commercial rationale, nominee arrangements that mask the real controller, frequent or unexplained changes in ownership, and reluctance to provide beneficial-owner information. Layered holdings through multiple shell entities in secrecy jurisdictions are a classic concealment technique.

Building the skill

Tracing ownership through corporate structures is a practical skill that improves with training and repetition. Our AML and compliance CPD courses cover beneficial ownership identification, the PSC regime and the practical use of registers as part of a risk-based approach.

Why beneficial ownership matters for accountants

Identifying the ultimate beneficial owner (UBO) — the real person who ultimately owns or controls a client — is central to anti-money-laundering compliance because criminals use layered company structures to hide who is really behind the money. For accountants, failing to look through a corporate structure to the human at the top is one of the most common and serious due-diligence gaps. Establishing the UBO is what turns a name on a form into a genuine understanding of who you are acting for.

Practical steps to identify a UBO

In practice that means tracing ownership and control through each layer of a structure, applying the relevant ownership/control thresholds in your jurisdiction, corroborating the information against reliable sources rather than taking it on trust, and keeping clear records of how you reached your conclusion. Complex, opaque or deliberately obstructive structures are themselves a red flag warranting enhanced scrutiny.

Keeping it current

Ownership changes, so UBO information should be refreshed as part of ongoing monitoring rather than captured once at onboarding and forgotten.

Frequently asked questions

Is a PSC the same as a beneficial owner?

They are closely aligned but not identical. The PSC regime is the UK's mechanism for capturing beneficial ownership of companies, using a broadly comparable 25% control threshold, but the AML concept of beneficial owner also extends to trusts and other arrangements.

Can I rely on Companies House for UBO checks?

You should consult the register, but you must still take your own reasonable measures to verify beneficial owners. As identity verification reforms bed in, the register becomes more dependable, but it does not replace your own due diligence.

What if no one owns more than 25%?

Where no individual meets the ownership or control test, the senior managing officials of the entity are treated as the beneficial owners for due-diligence purposes.

Ultimate beneficial ownership is where many money-laundering schemes are won or lost. Identify the real people behind your clients, verify them proportionately, and treat deliberate opacity as the warning sign it usually is.