Share transfer is the procedure of passing existing shares from existing shareholders to other individuals.
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How do I file for SEIS investment?
To apply for the Seed Enterprise Investment Scheme (SEIS), you need to:
- Apply for advance assurance. If you've obtained an advance assurance, you need to provide copies of any documents that have changed since your advance assurance application was approved.
- Email HMRC to request for the application form in Welsh
- You need to complete a separate application for each share issue.
- When you've issued your shares, you need to complete a compliance statement (SEIS1) and send it to HMRC.
You may submit your application by email (email@example.com), or via post.
The postal address is:
Venture Capital Reliefs Team
HM Revenue and Customs
How do I transfer/ change a company shareholders?
Adding company shareholders
To appoint new shareholders, you need to issue new shares to the individual, or transfer or sell existing shares owned by a current shareholder to the individual.
Transfer existing shares:
- Complete a stock transfer form
- File the stock transfer form with HMRC, depending on whether money is paid for the stock transfer
- Issue a share certificate to new shareholders
- Inform Companies House of the details of new company shareholders
Issue new shares:
- All existing members need to waive pre-emption rights on the allotment of shares
- Complete form SH01
- Inform Companies House of the details of new company shareholders before, or when the next confirmation statement is due.
Removing company shareholders
If an existing shareholder wants to leave the company, their shares must be transferred or sold to someone else. The company directors are responsible for overseeing the transfer, as well as updating the statutory register of members and Companies House with details of the new shareholders.
Further information is available on Companies House's guide on how to change shareholders.
How do I file for EIS investment?
To apply for the Enterprise Investment Scheme (EIS), you need to:
- Obtain the application form from HMRC. You need to request for the form in Welsh.
- If you've received advance assurance, you need to show copies of documents that have changed since you received advance assurance from HMRC.
- If you haven't received advance assurance, you need to provide the following information about your company and any subsidiaries:
- Business plan and financial forecasts
- Latest accounts or bank statements
- An explanation of how you meet the risk to capital condition
- Information on all trading and activities to be carried out, and how much you expect to spend on each activity
An up-to-date copy of the memorandum and articles of association
- The information memorandum, prospectus or other document used to explain the fundraising proposal to your investors
- Information of any other agreements between your company and the shareholder
- A list of the amounts, dates and venture capital schemes under which you've previously received investment
- Any other documents to show you meet the qualifying conditions
- If you're applying as a knowledge intensive company, you need to provide evidence of how you qualify as one.
What is share allotment?
Share allotment refers to the creation and issuing of new shares to new or existing shareholders. This differs from share transfer, which is the procedure of passing existing shares from existing shareholders to other individuals.
How many shares should my new Company issue?
A minimum of one share must be issued upon incorporating. Additionally, if you plan on having more than one shareholder, then you must issue at least one share per shareholder.
Often, individuals who wish to be sole owners issue a single share in order to own 100% of their company. However, if they later wish to split the ownership, or change the structure of the business, having only 1 share could lead to complications down the line.
A common practice is to issue share capital which is easily divisible in the future (for example it may be best to issue 50 or 100 shares upon incorporation). By doing so this will allow you to change the ownership of shares more easily down the road. Many businesses tend to issue 100 shares of £1 each, with each share representing 1% of the business.
Entrepreneurs relief: selling shares
If you are selling shares in all or part of your business, you might qualify for a Capital Gains tax relief called Entrepreneurs' Relief.
Below, you'll find a short guide providing a quick overview of the essentials - including how Entrepreneurs' Relief works, whether you're eligible for a claim and how you can make a claim. Keep in mind that this is a general guide, and we highly recommend speaking with an accountant before you make a claim.
Entrepreneurs' Relief is a scheme that reduces the amount of Capital Gains Tax payable when you dispose of (sell) shares in your business. Instead of the usual rates, you pay a reduced tax rate of 10% on the first £10 million of gains. There isn't a limit to the number of times you can claim.