Any issue or transfer of company shares must be undertaken with professional advice.  Share transactions always have tax consequences both immediately and in the long term.

Increasing authorised shares
Authorised shares are effectively the total share pool relating to the company, of which some or all may be issued and paid for by shareholders.  In most circumstances the amount of authorised shares has no impact on the affairs of the company.  It is occasionally necessary to increase the amount of authorised shares if new shares are to be issued to shareholders.  This is a simple process which we can deal with for you using Companies House on line filing system.

Allotment of shares (Issuing shares from a company to new or existing shareholders)
The issued shares are those that are held by shareholders, these are the active shares of the company.  Shares are usually issued to one or more director when the company is formed.  For many companies no further share issues are ever made.

If you are thinking of issuing further shares either to existing shareholders or new shareholders please discuss this with us.  There are regulations that can protect existing shareholders to avoid dilution of their holding, and there are significant tax consequences of issuing shares that have value.  How this affects your particular circumstances can usually be easily explained and the consequences made acceptable. 

Once the consequences are clear and agreed to, the procedure for issuing further shares can be carried out by us online.

Transfer of shares (Transferring shares from an existing shareholder to new or existing shareholders)
The transfer of shares between shareholders does not affect the company directly.  Even if no price is paid for the shares there are potential tax implications for both the transferor (capital gains tax) and transferee (benefit in kind).  Stamp duty is payable on a transfer of shares for which payment is made.

We can advise of the consequences of a share transfer and carry out the relevant checks, forms and lodgement with HM Revenue and Customs.

If you require any assistance with share transactions please contact us.  The tax and regulatory situation will be specific to your circumstances but is generally straightforward.

Links to external pages (open in a new tab or window)

Companies House guide to share capital