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Who is a Beneficial Owner?

In a company’s Corporate Transparency Act (CTA) report to the government, they must identify and provide some pieces of information about anyone considered a “beneficial owner” of that entity. There are no limits to the number of people who can be a beneficial owner.
The law defines a beneficial owner as anyone who exercises “substantial control” over the company, or owns/controls at least 25 percent of its ownership interests.
Individuals are deemed to have substantial control if they are any of the following with relation to the reporting company: a senior officer; someone with authority to appoint or remove senior officers or a majority of directors; an important corporate decision-maker; and/or someone with any other form of substantial control identified by FinCEN’s Small Entity Compliance Guide.
A company’s report needs to contain the following beneficial owner information:
  1. The full legal name, date of birth, residential address and a unique identifying number on a current form of ID (passport, driver’s license, etc.) for any/all beneficial owners; or
  2. Those individuals’ FinCEN Identifier (a personalized ID number), if they have one.

For more detail on who must file a report, refer to this Q&A document about the CTA. Platinum Filings also has produced a white paper recapping the relevant parts of the CTA for businesses everywhere, and what they need to do to comply.