What we do
Share Transfer
Share Transfer
There may be times when you want to change the share structure of your company; 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.
Transferring shares
Shares can be transferred from a shareholder to another person (either a new or existing shareholder). Shares are transferred by way of gift or sale. Typically, shares are transferred to introduce a new shareholder.
So long as a company has enough shares, it’s possible to transfer shares in a limited company any time after incorporation.
Before you take any action on changing your share structure within your company contact your Account Manager so we can understand and advise on your plans.
The process
Any transfer of shares needs to be formally actioned by you as the director. You will need to complete the following steps:
- Confirm your shareholdings
- Hold a board meeting
- Complete a stock transfer form
- Issue new share certificates
- Update your company’s confirmation statement (CS01) with the new share totals.
Legal Provisions For Share Transfer
- STAMP DUTY ON TRANSFER DEED: Stamp duty is 25 paisa for every Rs.100 or part thereof of the value of shares.
- Period FOR DEPOSIT TRANSFER DEED: The transfer deed i.e. Form SH4 shall be submitted to the company within 60 (sixty) days of its execution by or on behalf of transferor or transferee.
- TIME FOR ISSUANCE OF CERTIFICATE: As per Section 56(4), the company shall provide a certificate for transfer of shares within one-month application for registration of transfer of shares.
Exceptions For Restrictions On Transfer Of Shares
- REPRESENTATIVE: No restrictions can be imposed where the shareholder intends to transfer his/her shares to their representative.
- LEGAL REPRESENTATIVE: In the case of death of a shareholder , the legal representative may register the shares in the name of heirs i.e. on whom the shares have been devolved.
Penalties
For company – Minimum is Rs. 25,000 and maximum is Rs. 5,00,000.
For an officer In default – Minimum is Rs. 10,000 and maximum is Rs. 1,00,000.
Share Transfer with E-TAX HUB INDIA
Only when the transfer is registered by the corporation the share transfer procedure will be completed. The corporation must transmit the share certificate to the transferee within one month of registration. The transferability of shares in a private limited company is completely done by following the norms made in AOA while shareholders in a public limited company can readily and freely transfer their shares.
To know more about Share Transfer, Services and for a free consultation, get in touch with our team on sales@etaxhub.inor call 9962903855.
