Transfer of Shares

Make entry and exit of your shareholder easyTransfer the shares of a Private Limited Company smoothly to avoid business disruption

₹ 2499 + Actual govt fees
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Transfer of Shares
₹2,499+GST
+ Additional Govt Fees
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WHAT IS TRANSFER OF SHARES?

Transfer of shares means the transfer of ownership of the shares from one person to another. There may be times when a Company wants to change the share structure either by adding a new shareholder or by changing the existing proportion of shares between shareholders. A share transfer is the process of transferring existing shares from one person to another; either by sale or gift.

WHEN THE SHARE TRANSFER BECOME EFFECTIVE?

Transfer of shares is effective by removing the name of the existing shareholder from the register of members and by inserting the name of the new shareholder in the register of members. Thus it is mandatory to alter the register of members immediately after the share transfer.

WHAT IS THE VALUE OF SHARE TRANSFER STAMPS TO BE AFFIXED ON THE TRANSFER DEED?

Stamp duty for transfer of shares is 0.25% of consideration i.e. the amount to be paid is 25 paise for a share transfer of Rs. 100 as per Notification No. SO 130(E), dated 28-01-2004 issued by the Ministry of Finance, Department of Revenue, New Delhi.

WHY SHARE TRANSFER DEED IS TO BE PREPARED?

One of the most important documents which are prepared at the time of transfer of shares is SHARE TRANSFER DEED. In share transfer deed every detail of transferor and transferee like number of shares transfer, date of transfer, shall be mentioned and date of execution shall also mentioned in deed.

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Documents Required For Transfer of Shares

Proprietor

  • PAN (Permanent Account Number) of all proposed directors (Self attested)
  • Identity Proof (Voter Id, Passport, Driving License) of all proposed Directors. (Self attested)
  • Latest passport size Photographs of all directors.
  • Address proof with Present address Mobile bill OR Telephone bill OR Electricity bill OR Bank Statement not older than 1 Month (Self attested)

One Person Company

  • PAN (Permanent Account Number) of all proposed Share Holders (self attested)
  • Identity Proof (Voter Id, Passport, Driving License) of all proposed ShareHolders (Self attested)
  • Latest passport size Photographs of all Share Holders.
  • Address proof with Present address Mobile bill OR Telephone bill OR Electricity bill OR Bank Statement not older than 1 month (Self attested)

Private Limited

  • Electricity Bill along with Rent Agreement OR Ownership proof and NOC

Public Limited

  • INC 14
  • INC 15
  • Projected Income and Expenditure Account
  • Grounds for making application

Partnership Firm

LLP

NGO

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KEY ASPECTS

RESTRICTION OF TRANSFER

If the Articles of Association restrict the transfer of shares, then share transfer will be possible only after alteration and approval of shareholders by way of passing special resolution.

INTIMATION TO EXISTING SHAREHOLDERS

If a shareholders wants to sell his shares, he have to intimate to the Company and the Board of Director of the Company need to offer the existing shareholder the option to buy within a prescribed time.

APPEAL AGAINST REFUSAL TO REGISTER TRANSFER.

The transfree of shares may appeal to the tribunal against the refusal within a period of 30 days from the date of receipt of notice from the Company OR
and in case no notice is received from the Company, then within 60 days from the date of intimation of transfer/transmission given to the Company.

PENAL CLAUSE.

All Non-compliance penalty between Rupees 25,000 to Rupees 5,00,000 can be imposed on the Company, and every officer of the Company defaulted will be fine between Rupees 10,000 to Rupees 1,00,000.

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Frequently asked questions

What is the procedure for transfer of shares?

Share transfer deed is an instrument of transfer that must be executed by both transferor and transferee. Share transfer deed must be duly stamped and delivered to the company along with certificate relating to shares transferred.

Who pays the stamp duty on transfer of shares?

Stamp Duty is levied at the rate of 0.25% of consideration i.e. the amount to be paid is 25 paise for a share transfer of Rs. 100. If required, the total amount of stamp duty will be rounded off to next or upper 5 paise. Though there is no stamp duty on transfer of shares or debentures in a depository scheme

Can I transfer physical shares to another person?

In case, shares are held jointly in physical form by investors, then the same can be dematerialized by opening a demat account in joint names. ... Transferring physical shares requires payment of transfer fees through franking of transfer deed documents, a service investors used to avail from BOI Shareholding.

Can a shareholder transfer shares?

Share transfers from one person to another. Limited company shares can be transferred or sold just like any other form of property. ... In many companies, the articles of association may stipulate that shares may only be sold or given to an existing member, or a family member of an existing shareholder.

Can shares of a private company be transferred?

Any private agreement between the shareholders are not binding either on the company or on the shareholders. Further, share transfer can only be restricted by the Articles of Association. The right to transfer shares of a private limited company cannot be an total prohibition or ban on share transferability.

How do I transfer shares from one account to another?

Hi, there are two ways to transfer your shares from one demat to another demat account. To transfer shares manually, to can ask for the Delivery Instruction Slip from the broker you hold your shares with. Once you fill up the slip, you can submit that to the broker whom you wish to transfer the shares.

Can you gift shares to a family member?

If, however, it can be demonstrated that the transfer of shares is for reasons of family or personal relations, the income tax charge may be avoided. A gift of shares to a family member is also a deemed to be a disposal of shares for capital gains tax purposes.

How do I get a share transfer stamp?

The stamp duty applicable on share transfer is at 0.25% on the market value on the date of execution of the transfer deed. Share Transfer Stamps can be obtained from the authorised stamp vendors. Your sharebroker can also help you in this regard.

Is there stamp duty on sale of shares?

When you buy shares, you usually pay a tax or duty of 0.5% on the transaction. If you buy: shares electronically, you'll pay Stamp Duty Reserve Tax ( SDRT ) shares using a stock transfer form, you'll pay Stamp Duty if the transaction is over £1,000.

Can I sell my physical shares?

No, You cannot because no 0ne will buy shares in physical format. So, to sell the physical shares you need to open a Demat account. You have to convert those shares into Dematerialise format & then you can sell those shares through your Demat account.

Can I sell my physical shares?

No, You cannot because no 0ne will buy shares in physical format. ... So, to sell the physical shares you need to open a Demat account. You have to convert those shares into Dematerialise format & then you can sell those shares through your Demat account.

Can we have 2 demat account?

Demat account is almost same like your bank accounts. Yes, You can open multiple Demat account but you can't have them with the same broker/DP. Also one demat account can be mapped to multiple trading accounts, no issues.

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