KYB

How to Calculate Beneficial Ownership: Worked Examples

Most beneficial ownership questions come down to arithmetic and one judgement: do you multiply percentages down the chain, or does control of a holding company carry its whole stake? This guide works through direct holdings, chains, 50/50 splits and multiple paths, shows where the rules differ by jurisdiction, and explains which document gives you the full picture.

Published: October 2026 Category: KYB Read time: ~12 minutes

Quick Answer

To find the ultimate beneficial owners (UBOs) of a company, trace every chain of ownership up to the natural persons at the top. For indirect holdings, the usual method is to multiply the percentages along each chain and add the results where one person holds through more than one route. Compare the total with the local threshold: more than 25% in the UK, Hong Kong and Singapore, 25% or more under the US CDD Rule and the EU AML Regulation, and at least 20% under the Philippine SEC’s rules from 2026. Then check control: under the UK, Singapore and EU AMLR rules, a person who controls a holding company can be treated as holding that company’s whole stake, so they can be a UBO even when multiplication gives less than 25%. If no one qualifies through ownership, look for control by other means, and as a last resort record the senior managing official.

FATF’s standards say beneficial ownership can be held directly or indirectly “through a chain of corporate vehicles”, but they do not prescribe a calculation method. National rules fill that gap in different ways, which is why the same structure can produce a different answer in London, Singapore and Brussels. The examples below use simple numbers so that the method, not the arithmetic, is what you remember.

For the wider verification process, see our UBO verification guide. For trusts, nominees and multi-jurisdiction structures, see UBO discovery in complex corporate structures.

The Two Ways to Count Indirect Ownership

1. Multiplication. Multiply the percentages held at each level of a chain, then add together the results of every chain that leads to the same person. The EU AML Regulation, which applies from 10 July 2027, writes this into law: indirect ownership is calculated by multiplying the holdings of the intermediate entities in each chain and adding the results from the various chains, taking into account shareholdings at every level.

2. Control attribution. If a person controls an intermediate company, they are treated as holding that company’s whole stake in the target, with no multiplication. The UK’s persons with significant control (PSC) rules work this way: a person who has a majority stake in a legal entity is treated as holding the shares that entity holds, through any chain in which each entity has a majority stake in the next. Singapore’s rules for registrable controllers are similar: a person with a controlling interest in a company, or at least 20% of its voting power, is deemed to have an interest in the shares that company holds. The EU AML Regulation adds a mixed rule for chains that combine ownership and control.

The two methods often give the same answer. Where they differ, the person who controls a holding company is usually the one that multiplication misses, as Example 3 shows.

Ownership Thresholds by Jurisdiction

Regime	Ownership threshold	Indirect holdings
FATF standards	A threshold such as 25% is given as an example; since 2022 the Recommendation 24 standard caps it at a maximum of 25%	Ownership may be held through a chain of corporate vehicles; no calculation method is prescribed
EU AML Directive (until 10 July 2027)	A shareholding of 25% plus one share, or an ownership interest of more than 25%, is an indication of ownership	Indirect where the stake is held by a corporate entity, or several entities, under the control of the same natural person
EU AML Regulation 2024/1624 (from 10 July 2027)	25% or more of the shares, voting rights or other ownership interest	Multiply along each chain and add the chains; control of an entity in the chain (50% plus one) carries its whole stake
United Kingdom (MLR 2017 and PSC rules)	More than 25% of the shares or voting rights	Whole holding attributed through a chain of majority stakes; no multiplication
United States (FinCEN CDD Rule)	25% or more of the equity interests, plus one individual with significant control	Direct or indirect; the rule sets no calculation method
Singapore (registrable controllers)	More than 25% of the shares or voting power	Deemed interest through a controlling interest, or at least 20% of the voting power, in a holding company
Hong Kong (AMLO)	More than 25% of the issued share capital or voting rights	Direct or indirect, including through a trust or bearer shares
Philippines (SEC, from 1 January 2026)	At least 20%, down from at least 25%	Direct, indirect or through a chain of ownership

Two details catch people out. First, “more than 25%” and “25% or more” give different answers for a shareholder with exactly 25%. Second, thresholds are minimums: firms can and often do apply a lower one for higher-risk customers, and the EU AML Regulation lets the Commission set a lower threshold, of 15% or a higher figure below 25%, for higher-risk categories. Our UBO threshold lookup lists thresholds for more jurisdictions.

Worked Examples: Direct Holdings and Chains

Example 1: direct holdings and the exact-25% edge

Target Ltd is owned by Aisha (30%), Ben (25%) and Carlos (45%).

Person	Working	Result
Aisha	30% held directly	UBO in every regime
Carlos	45% held directly	UBO in every regime
Ben	25% held directly	Not a UBO where the test is more than 25% (UK, Hong Kong, Singapore). A UBO where it is 25% or more (US, EU AMLR) or at least 20% (Philippines)

Ben shows why you should always quote the exact wording of the threshold you are applying, not just “25%”.

Example 2: a simple chain

Dana owns 60% of HoldCo. HoldCo owns 50% of Target.

Person	Working	Result
Dana, by multiplication	60% × 50%	30%: UBO
Dana, by control attribution	Dana controls HoldCo, so she is treated as holding all of HoldCo’s 50%	50%: UBO

Both methods agree that Dana is a UBO. They only disagree about the size of her interest.

Example 3: where the methods disagree

Eli owns 60% of HoldCo. HoldCo owns 40% of Target.

Person	Working	Result
Eli, by multiplication	60% × 40%	24%: below a 25% threshold
Eli, by control attribution	Eli controls HoldCo, so he is treated as holding all of HoldCo’s 40%	40%: UBO

Under the UK PSC rules, Singapore’s registrable controller rules and the EU AML Regulation’s rule for mixed chains, Eli is a beneficial owner because he controls the company that owns 40% of Target. A firm that only multiplies would miss him. The lesson: whenever someone controls an intermediate company, test control as well as multiplication.

Worked Examples: 50/50 Splits and Multiple Paths

Example 4: a 50/50 split at the top

HoldCo owns 100% of Target. Farah and George each own 50% of HoldCo.

Person	Working	Result
Farah	50% × 100%	50%: UBO
George	50% × 100%	50%: UBO

Both are UBOs through ownership. Neither controls HoldCo alone, because 50% is not a majority. Under the UK PSC rules that means neither is treated as holding Target’s shares through HoldCo: if HoldCo keeps its own PSC register, Target records HoldCo as a relevant legal entity and Farah and George appear on HoldCo’s register. If the two have agreed to exercise their rights together, the PSC rules treat each of them as holding the combined interest.

Example 5: a 50/50 split below the threshold

Hana and Ivan each own 50% of HoldCo. HoldCo owns 40% of Target. The other 60% of Target is widely held.

Person	Working	Result
Hana	50% × 40%	20%
Ivan	50% × 40%	20%

At a 25% threshold, neither is a UBO through ownership, and because neither controls HoldCo, control attribution does not help. The next step is to look for control by other means, such as a right to appoint Target’s board or a veto under a shareholders’ agreement, and to check whether Hana and Ivan act together. Under the Philippine SEC’s 20% threshold, both would qualify.

Example 6: one person, two routes

Jun owns 15% of Target directly. He also owns 50% of HoldCo, which owns 30% of Target.

Person	Working	Result
Jun, direct route	15%	15%
Jun, through HoldCo	50% × 30%	15%
Jun, total	15% + 15%	30%: UBO

Neither route crosses 25% on its own, but the total does. Always add a person’s holdings across every route before comparing them with the threshold. The EU AML Regulation requires this explicitly. Where a structure has many routes, mapping it in a UBO discovery tool is quicker and easier to evidence than a spreadsheet.

When Nobody Reaches the Threshold

FATF sets out three steps that are “cascading measures”, not alternatives:

Ownership: identify the natural persons who ultimately have a controlling ownership interest.
Control by other means: where there is doubt, or no one qualifies through ownership, identify the natural persons who control the company in other ways.
Senior managing official: if neither step identifies anyone, identify the senior managing official.

Example 7. Five unrelated shareholders each own 20% of Target. No one passes a 25% ownership test. You then look for control: majority voting rights through an agreement, the right to appoint or remove most of the board, veto rights, or decisions on profit distribution are the examples the EU AML Regulation gives. If you find no one, you record the senior managing official, such as the chief executive, and keep a note of the steps you took.

The US works differently. Under the FinCEN CDD Rule, a firm always identifies one individual with significant responsibility to control, manage or direct the company, such as the CEO or CFO, in addition to anyone who owns 25% or more.

Documents That Show the Ownership Structure

The document that gives a consolidated view of the whole structure is an ownership structure chart, also called a group structure chart or organogram. It shows every entity between the customer and the natural persons at the top, with the percentage held at each link. Customers usually provide it, often signed or certified by a director.

A chart is the customer’s own account, so verify each link against independent evidence:

Company registry extracts for each entity in the chain.
Registers of members or shareholders showing who holds the shares.
Beneficial ownership registers and filings, such as the UK PSC register, Singapore’s register of registrable controllers, or the Philippine SEC beneficial ownership filing, which the General Information Sheet carried before the 2026 rules.
Constitutional documents and shareholders’ agreements, which reveal voting rights, board appointment rights and vetoes.
Trust deeds where a trust sits anywhere in the chain.

Discrepancies between the chart and these records are a red flag in their own right. Nominee shareholders and registered addresses shared by many companies are others; see our guide to shell company red flags.

Practice Question

Questions like this one appear in AML certification exams and in onboarding reviews.

Question. Northwind Corp is owned 60% by Maria and 40% by Eastgate Holdings. Eastgate is owned 70% by Jose and 30% by Lena. Using a 25% threshold, who are Northwind’s beneficial owners?

Person	Working	Result
Maria	60% held directly	60%: UBO
Jose	70% × 40% (and he controls Eastgate)	28%: UBO
Lena	30% × 40%	12%: not a UBO

Answer: Maria and Jose. Now change one fact: Eastgate is owned 50/50 by Jose and Lena. Each then holds 20% of Northwind, so neither qualifies at 25% and neither controls Eastgate. Only Maria remains a UBO through ownership. At the Philippine 20% threshold, Jose and Lena would both qualify.

Frequently Asked Questions

How do you calculate indirect beneficial ownership?

Multiply the percentages held at each level of the chain, and add together the results where the same person holds through more than one chain. Then check control: in the UK, Singapore and under the EU AML Regulation, a person who controls an intermediate company can be treated as holding that company’s whole stake.

Is a 25% shareholder a beneficial owner?

It depends on the wording of the rule. Where the test is more than 25%, as in the UK, Hong Kong and Singapore, a shareholder with exactly 25% is not a beneficial owner through ownership. Where the test is 25% or more, as under the US CDD Rule and the EU AML Regulation, they are.

Who is the UBO of a company owned 50/50?

Both shareholders. Each owns 50%, which is above any 25% threshold. Neither controls the company alone, which matters if the company is itself part of a longer chain.

What if no one owns more than 25%?

Look for people who control the company by other means, such as rights to appoint the board or veto decisions. If there are none, identify the senior managing official and record the steps you took. In the US, firms always identify one individual with significant control in addition to any 25% owners.

Which document provides a consolidated view of the ownership structure?

An ownership structure chart (group structure chart or organogram) shows every entity and natural person in the structure with the percentage held at each link. Verify it against registry extracts, share registers and beneficial ownership filings.

What is the beneficial ownership threshold in the Philippines?

Under SEC Memorandum Circular No. 15, series of 2025, which took effect on 1 January 2026, a beneficial owner through ownership is a natural person owning at least 20%, directly, indirectly or through a chain of ownership. The earlier rules used at least 25%. Check the circular for the full definition.