subject: Share And Stock Transfer Form [print this page] Stock Transfer Form Stock Transfer Form
The stock transfer form is one of the basic documents used following incorporation of a company. It is used to record the transfer of stock from one shareholder to another.
Depending on the reason for transferring stock, there may be different documents required to initiate the transfer. While the transfer of shares is not difficult, many people have questions about what they should do. Shares in a company are often transferred by private agreement between the seller and the buyer. Even though specific requirements for transferring shares may differ, there are some general guidelines required by most guarantors.
Things You'll Need
Stock transfer form
Letter of instruction
Original stock certificates
To complete the stock transfer form you will be asked to provide the following information:
Consideration money (How much is being paid for the shares)
Name of Security (e.g. 100 Ordinary Shares for XYZ LIMITED)
Description of Security
Number of shares transferred
Name and address of transferor
Name and address of transferee
Authorising signature from both parties
Stamp Duty on Shares
When you buy shares valued above 1,000 using a stock transfer form, you usually have to get the form stamped by HM Revenue & Customs (HMRC) and pay Stamp Duty
Share Transfers Valued at 1,000 or less
If you buy stocks and shares for 1,000 or less you don't normally have to pay any Stamp Duty. You also don't have to tell HM Revenue & Customs (HMRC) about the transaction.
All you need to do is:
make sure the exemption certificate on the back of the stock transfer form has been completed
send the stock transfer form and the share certificate to the registrar of the company you've bought shares in
.
Share Transfers Signed Before 13 March 2008
The rules above have applied since 13 March 2008. If a share transfer with a value of 1,000 or less was agreed and signed before that date, it will need to be stamped by HMRC and you'll have to pay Stamp Duty.
Calculating How Much Stamp Duty is Payable
The amount of Stamp Duty you pay is based on the 'consideration' you give for the stocks or shares. The consideration can be:
cash
other stocks and shares
debt, which is usually related to the loan stock
You pay Stamp Duty at the rate of 0.5 per cent of the value of the consideration, rounded up to the nearest 5, on each document to be stamped.
Net Lawman will not only provide you new version of stock transfer form in simple form and plain English, but also calculate your stamp duty accordingly.
Procedure of shares transfer
The procedures that need to be followed by a shareholder to have their shares transferred to another person are set out in the Articles of Association of a company. Typically, even for listed companies, where there is a printed share certificate (as appose to the shares being held electronically on CREST) a transfer needs only that the share certificate together with a valid signed stock transfer form are delivered to the company's registered office or to the company's outsourced share registrar.
The transfer procedure in summary is:
complete the stock market form
transferor sign the form
the transfer form and the relevant certificate(s) are delivered to the transferee
the transfer form is, if necessary, stamped
the transferee lodges the transfer form and the relevant certificates(s) with the company
the board of directors approve the transfer
the registers are updated, the old certificates are cancelled and any new certificates issued
The New Transfer Form
The changes require a new stock transfer form to be used. The front of the form remains unchanged. The current certificate on the reverse of the form is no longer required and has been removed. The new self certification certificate has been added to the reverse of the form for transfers on sale where the consideration is 1,000 or less. Note, there will no longer be a need to certify certain transactions on the reverse of the stock transfer form, e.g. transfers between nominees where there is no change in the beneficial ownership of the shares, and the certificate will be removed from the form.
Final Checklist
You should ensure that the standard stock transfer form has been sent by the transferor showing the number and type of shares, the price and the name of the transferee. You should also confirm that the form has been signed by the transferor and that the stamp duty payable on the transfer of shares has been paid.
Furthermore, you should check whether there are any restrictions on the transfer of shares in the Company's Articles of Association.
From where can I get updated Share and Stock Transfer Form
Share transfer dealing is a complex area and specialist advice should be sought from Solicitors and Barristers. Net Lawman has updated its all documents to comply with the Companies Act 2006.
Net Lawman delivers two versions with detailed and simple explanatory notes. The Net Lawman version is in plain English and easy to understand.
