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Requesting beneficial ownership information from a corporate client

Check the reporting obligation first, then ask for exactly what FinCEN's own report requires.

Asking a company client for beneficial ownership details is only worth doing once you know the Corporate Transparency Act reporting obligation actually applies to that client. This guide sets out the practical steps once it does. It is general information, not legal or compliance advice.

Action plan

1 Confirm foreign-company scope and exemptions before asking A U.S. company is exempt; a foreign-formed entity must meet the registration test and not qualify for another exemption.

Start with the entity, not a routine owner questionnaire. U.S. companies are exempt from BOI reporting requirements. A potential foreign reporting company is formed under the law of a foreign country and registered to do business in any U.S. State or Tribal jurisdiction by filing with a secretary of state or similar office; it must also fall outside the other statutory or regulatory exemptions. Confirm each condition against the current rule before asking for details. The foreign company's own reporting question remains separate from whether a particular individual is reportable.

  • Confirm foreign formation and registration in a U.S. State or Tribal jurisdiction
  • Check all other exemptions before treating the company as a reporting company
  • Do not request BOI as a default intake step for a U.S.-formed company

Done when: The company's foreign formation, U.S. registration, and possible exemptions are checked before a BOI request is made

FinCEN: Final Rule Questions and Answers
2 Identify who actually counts as a beneficial owner It's a specific test, not just whoever the client names as an owner.

FinCEN's final-rule Q&A confirms that the beneficial-owner definition did not change: an individual is a beneficial owner if they directly or indirectly exercise substantial control or own or control at least 25% of the reporting company's ownership interests. Only individuals count; a trust, company, or other entity is not itself an individual beneficial owner. Apply this test after confirming that the entity is a non-exempt foreign reporting company, and then apply the separate U.S.-person reporting relief.

  • Check both the 25% ownership-interest test and the substantial-control test independently
  • Include only individuals, never a trust, company, or other entity as the named beneficial owner
  • Ask the client directly who exercises senior-officer-level control, not only who holds shares

Done when: Every individual meeting the 25% ownership test or the substantial-control test has been identified for the client entity

FinCEN: Final Rule Questions and Answers
3 Request reportable fields only for non-U.S. beneficial owners The final rule excludes U.S.-person owners and applicants from the BOI request.

For each non-U.S.-person beneficial owner whose details are reportable, FinCEN's BOI report filing instructions list the identifying fields and acceptable document image; an eligible FinCEN identifier may be used instead of those details. Reporting companies do not need to report BOI for U.S. person beneficial owners or U.S. person company applicants. U.S. persons do not need to provide BOI to reporting companies where they are beneficial owners or company applicants. Do not collect these BOI details from a U.S. person for a report under this rule.

  • Use FinCEN's official filing instructions for the fields required from a reportable non-U.S. beneficial owner
  • Do not request or report BOI about a U.S.-person beneficial owner or company applicant
  • Keep BOI collection separate from any other client identity process your firm may have

Done when: Only information that FinCEN requires for a reportable non-U.S. beneficial owner has been requested

FinCEN: BOI report filing instructions
4 Apply the correct FinCEN-ID update rule The final rule distinguishes U.S. persons from non-U.S. persons and reporting companies.

FinCEN's final-rule Q&A states: U.S. persons with a FinCEN ID are not required to update or correct the information they previously submitted to FinCEN. Individuals who are not U.S. persons must still update a change within 30 calendar days, and correct information that was inaccurate when filed within 30 calendar days after becoming aware, or having reason to know, of the inaccuracy. A reporting company with a FinCEN ID must update or correct its company information through an updated or corrected BOI report. These FinCEN-ID rules are separate from the entity's initial-report deadline: the final rule did not restart those deadlines, and later-registered foreign reporting companies use the 30-day period tied to the earlier actual or public notice of effective registration.

  • Do not ask a U.S. person with a FinCEN ID to update or correct the information previously submitted to obtain it
  • For a non-U.S. person, distinguish a changed detail from an inaccuracy that was present when filed
  • Handle company FinCEN-ID updates through the company's updated or corrected BOI report
  • Do not confuse an ID-update deadline with the initial-report deadline for a foreign company

Done when: The applicable update or correction duty is identified for the correct person or company type, separate from any initial-report deadline

FinCEN: Final Rule Questions and Answers