Understanding PSCs and Beneficial Owners in UK Companies

Transparency and accountability are pillars of modern business law in the United Kingdom. As part of the UK’s commitment to combatting financial crime and promoting good governance, companies are legally required to disclose the individuals who ultimately own or control them. This is achieved through the identification and registration of Persons with Significant Control (PSCs) and beneficial owners.

These requirements are not simply bureaucratic formalities—they serve as essential tools in enhancing corporate transparency, complying with anti-money laundering (AML) obligations, and protecting the integrity of the UK’s business environment.

Who Qualifies as a Person with Significant Control (PSC)?

A PSC is an individual who exercises a notable degree of control or influence over a company. According to the Companies Act 2006 and supporting guidance, a person is considered a PSC if they meet one or more of the following conditions:

• Directly or indirectly holding more than 25% of shares in the company;

• Holding more than 25% of the voting rights;

• Having the right to appoint or remove the majority of the board of directors;

• Otherwise exercising significant influence or control (e.g., through contractual rights or informal power dynamics);

• Having the right to exercise or actually exercising significant influence or control over a trust or firm that meets any of the above conditions.

All UK companies (excluding publicly listed entities) are required to maintain a PSC register, submit it to Companies House, and ensure that it remains accurate and up to date. This register is publicly accessible, thereby reinforcing transparency and corporate accountability.

Understanding the Role of Beneficial Owners

The concept of a beneficial owner is broader than that of a PSC and plays a critical role in AML compliance, particularly during client due diligence (CDD) procedures. A beneficial owner is the natural person who ultimately owns or controls a legal entity, even if this is achieved indirectly or via complex shareholding arrangements.

For example, if a company is owned by another corporate entity or trust, the individual(s) behind that entity or trust must be identified as beneficial owners. This is especially relevant for regulated professions (such as law firms, financial institutions, and estate agents), which are required by law to identify beneficial owners before entering into a business relationship.

Why Does This Matter?

The requirement to identify PSCs and beneficial owners is not just about ticking a regulatory box. It promotes ethical business practices, safeguards against the misuse of corporate structures for illicit purposes, and strengthens the UK’s standing as a transparent jurisdiction for doing business.

For company founders, compliance professionals, and directors, understanding these concepts is essential not only for meeting legal obligations, but also for building trust with clients, partners, and regulatory bodies. Failure to comply may lead to criminal penalties, fines, and reputational damage.

Need Support?

If you're unsure about how to identify PSCs, complete your company’s register, or conduct proper due diligence, FB Legal Consultancy offers tailored, reliable guidance to help you meet your compliance obligations with clarity and confidence.

📩 Get in touch today for a consultation tailored to your business needs.