Protecting personal privacy is a growing concern for entrepreneurs and international investors forming companies in the UK. This guide explains how nominee directors and nominee shareholders can help you stay private while remaining fully compliant with UK law.
What Are Nominee Directors and Shareholders?
Nominee Director
A nominee director is a third-party individual appointed to act as director in name only. The true business owner retains control through a Nominee Director Agreement and optionally a Power of Attorney.
Nominee Shareholder
A nominee shareholder appears on the company’s share register, but holds shares on behalf of the actual owner. This is formalised through a Declaration of Trust, preserving legal ownership rights for the beneficial owner.
Are Nominee Services Legal in the UK?
Yes — nominee structures are legal under UK law, including the Companies Act 2006. However, they must not be used to conceal ownership from regulators or to engage in illegal activities such as:
- Tax evasion
- Money laundering
- Failure to declare beneficial ownership
✅ Key Point: Privacy from the public is legal. Concealing control from regulators is not.
How Nominee Services Protect Privacy
- Reduces Public Visibility: Your name does not appear on Companies House public registers.
- Protects Strategic Interests: Useful in competitive industries or high-profile situations.
- Simplifies International Operations: Enables non-residents to set up UK companies discreetly.
PSC Register and AML Compliance
The Persons with Significant Control (PSC) regime requires disclosure of anyone who:
- Owns more than 25% of shares or voting rights
- Has the power to appoint or remove directors
- Exercises significant influence or control
Even if using nominees, the beneficial owner must be declared on the PSC register if they meet these criteria.
Additionally, service providers offering nominee services must:
- Be HMRC-registered Trust or Company Service Providers (TCSPs)
- Follow Anti-Money Laundering (AML) regulations
- Conduct Know Your Customer (KYC) checks
⚠️ Warning: Misuse of nominee structures to hide control can lead to fines or prosecution.
Essential Legal Documents
- Nominee Director Agreement: Defines scope, limits, and indemnities
- Declaration of Trust: Affirms beneficial ownership of shares
- PSC Register Filing: Ensures Companies House is properly updated
- Power of Attorney (optional): Allows beneficial owner to act for the company
How to Choose a Reputable Nominee Provider
- Ensure the provider is HMRC-registered as a TCSP
- Review their contracts, pricing, and AML policies
- Avoid any service promising "total secrecy" or "anonymity" without documentation
- Look for providers with strong legal experience and ethical business practices
Conclusion
Nominee directors and shareholders are fully legal and effective tools for privacy protection in UK company formation — when used correctly. Transparency with regulators, combined with proper documentation and ethical use, ensures that you maintain both discretion and full compliance.
Work with trusted professionals, comply with all UK laws, and you can enjoy the benefits of privacy without compromising your legal standing.
Published: 4/24/2025 2:16:06 PM
