A nominee corporation is a legal entity that holds and administers property (shares, real property, intangible property, or otherwise) as the registered legal owner, on behalf of the beneficial owner. The nominee corporation holds the property in trust for the beneficial owner. The nominee corporation exists within the context of a bare trust legal relationship.

The nominee corporation holds legal title to the property, meaning the nominee corporation is listed on all official documents, forms, deeds, certificates, registers, and databases as the owner of a particular property, but the beneficial owner retains beneficial ownership and control over the property.

Typically, a bare trust legal agreement is drawn between the beneficial owner and the nominee corporation stating that the property is being held in trust by the nominee corporation for the beneficial owner’s benefit. The agreement will also state that the beneficial owner may at any time, acquire legal title from the nominee corporation, at the beneficial owner’s option. Depending on the property held by the nominee corporation, the bare trust agreement may also dictate specific terms of the nominee arrangement, such as whether the nominee corporation has the ability to exercise voting rights (where the property held is shares of a corporation). In the majority of cases, the nominee corporation may only act upon voting rights where expressly directed, permitted, and authorized by the beneficial owner to do so.

What is the difference between a bare trust and a nominee corporation?

A bare trust is a legal relationship that facilitates the separation of legal ownership and beneficial ownership of a property. In a bare trust, the beneficiary holds the rights to the capital and assets within the trust, as well as any income generated from the trust assets. The trustee holds the trust assets and manages the assets under the direction of the beneficiary.

A nominee corporation exists within a bare trust arrangement. The nominee corporation is typically the bare trustee entity.

What is the difference between legal ownership and beneficial ownership?

The legal owner of a property holds legal title to the property. This means that the legal owner is listed on all official documents, forms, deeds, certificates, registers, and databases as the “owner” of a particular property. For example, the legal owner of the land will be listed on the deed and in the land registry of a particular jurisdiction.

The beneficial owner of a property is typically an individual or entity that enjoys the benefit of the property. The beneficial owner is typically entitled to the financial value of the property, meaning, any income or gain generated by a particular property would flow to the beneficial owner. Generally, for income tax purposes, the beneficial owner is required to report the income earned by the property, and the disposition of the property.

Illustration of a nominee corporation

Benefits of a nominee corporation

  1. Confidentiality: Nominee corporations are used by individuals or organizations as a form of confidentiality or anonymity. Typically, noteworthy individuals, such as politicians, celebrities, or high-net-worth individuals, will purchase real estate through a nominee corporation, to conceal their identity as the purchaser of the property.
  2. Administration: In some instances, it may make more sense administratively to use a nominee corporation to acquire assets, as the administration and legal management would all be done within the nominee corporation, which could typically be handled by appointed individuals within the nominee corporation. This makes sense for overseas investors or busy individuals where time is of the essence.
  3. Estate Planning: In some jurisdictions, the use of a nominee corporation may assist with reducing estate taxes, particularly probate.

Examples of the use of a nominee corporation

Buying Walt Disney World

When Walt Disney was looking to purchase land in the 1960s in Central Florida for what is now known as Walt Disney World, he used an assortment of nominee corporations to purchase various tracts of land from dozens of landowners. In an effort to avoid the landowners from drastically increasing their selling price upon learning of the true purchaser of the land, Walt Disney set up nominee companies such as the “Reedy Creek Ranch Corporation” and “Florida Ranch Lands Inc.”. These nominee corporations were the purchaser on record and the legal title owner of the various pieces of land comprising the Walt Disney World property. The beneficial owner was The Walt Disney Company.


Amy is a Certified Public Accountant (CPA), having worked in the accounting industry for 14 years. She is a seasoned finance executive having held various positions both in public accounting and most recently as the Chief Financial Officer of a large manufacturing company based out of Michigan.