Home Contact Us Login Experts Blog

Share Transfer

What do you mean by share transfer?

You may want to update your company's share structure at times, either by adding a new shareholder or transforming existing share proportions between shareholders. The practice of moving existing shares from one person to another, whether by sale or gift, is known as a share transfer.

Transferring shares

The shares of a shareholder can be transferred to another person. Shares can be given or sold as gifts. When a new shareholder is introduced, shares are usually assigned.It is possible to transfer shares in a company at any moment after incorporation as long as the company has enough shares.

The process

As the director, you must formally approve any transfer of shares. The following are the steps you must take:

You must validate your present shareholdings, the number of shares you desire to transfer, and the resulting share arrangement of your shareholders before moving any claims. If you're transferring shares to a new shareholder, you'll also need to know their name, date of birth, citizenship, home address, proof of ID, and relationship to your existing shareholders.

You may not have enough shares in your company to complete the transfer you wish in some cases. New shares would have to be issued as a result of this.

Organize a board meeting

A board agreement is required to approve the share transfer. To evaluate the stock transfer form and decide on the transfer, a board meeting should be held. Make sure to retain full meeting minutes that show the changed share structure and share ownership. These minutes should be kept safe with your company's documents; they'll be utilized to update Companies House later on, and they'll also serve as a good audit trail.

Fill out the stock transfer form.

A stock transfer form is a standard document for transferring existing shares. It includes information about the seller of the claims and the receiver, the type, and quantity of shares being transferred, and any consideration paid. Before signing and dating the form, you must fill in these facts as the director. Filling out a stock transfer form in black ink and BLOCK CAPITALS is the usual procedure. This form must be kept with your company's records.

Create new share certificates.

After you've decided on your share structure, you'll need to create new share certificates that explain the shareholdings, effectively cancelling any earlier certificates.

Documents Required

• PAN Card of both the transferee and the transferor

• Aadhaar Card/ Passport / Driving License /Voter ID Card of both the transferee and the transferor

• Original Share Certificates of the Transferor

• Company Registration Certificate

Plans

Rs. 5999 All inclusive price

Starter

  • Share Transfer To One To Many Persons
  • Expert Support
Rs. 8999 All inclusive price

Plus

  • Share Transfer From One To Another In Which Any One Or Both Is Corporate Entity
  • Expert Support
Rs. 13999 All inclusive price

Pro

  • Share Transfer From One To Another In Which Any One Or Both Is Related To Foreign Nation.
  • Expert Support

FAQ's

The transferor and the transferee must sign or have the transferor sign Form SH-4 for share transfer. It must be duly stamped, with enough value, dated, and executed by or on behalf of the transferor and the transferee.

Share transfer means shifting their rights on company between transferor and transferee.

Yes, when we transfer share from transferor to transferee then stamp duty applicable i.e. 25 paise per hundred rupees.

The Form SH-4 indicates that transfer of securities between transferor and transferee.

The process for registering gifted shares is similar to the process for a normal transfer. when we transfer share from transferor to transferee then stamp duty applicable i.e. 25 paise per hundred rupees.