Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
What an SBO is
A Significant Beneficial Owner is an individual who, often indirectly through holding companies, trusts or partnerships, ultimately holds 10% or more of a company’s shares, voting rights or distributions, or exercises significant influence/control. The rules look through corporate layers to the real person behind them.
The filing chain
The identified SBO declares their interest to the company in BEN-1; the company then files BEN-2 with the ROC and maintains a register of SBOs (BEN-3). Companies must take steps to find out their SBOs, issuing notices (BEN-4) where needed. Non-compliance carries penalties on the company, the SBO and officers. The 10% tests are technical — confirm for layered structures.
A worked example
Example: an Indian company is 60% held by a Singapore holding company, which is in turn majority-owned by an individual — that individual is likely an SBO and must be reported in BEN-2. A simple company directly owned by its founders may have no SBO to report (direct holdings are excluded). The rules mainly bite where ownership runs through other entities. Our team can assess and file your SBO position.