Can Shares Be Transferred in a Private Company?
Yes. Shares in a private limited company can usually be transferred, unless:
- The company’s Articles of Association restrict it
- There’s a Shareholders’ Agreement limiting transfer rights
- Pre-emption rights exist, giving other shareholders first refusal
It’s important to check your company’s Articles and agreements before proceeding. Dragonfly Associates can review these as part of our compliance support services.
Step-by-Step: How to Transfer Shares in a UK Company
Step 1: Review Internal Agreements
Before initiating any transfer:
- Review your Articles of Association
- Review any Shareholders’ Agreement
- Ensure existing shareholders have been given any required notice or pre-emption options
We help clients interpret these documents to confirm whether a transfer is permitted and under what terms.
Step 2: Prepare a Stock Transfer Form
You must complete a stock transfer form (Form J30 or a custom version) that includes:
- Names of transferor and transferee
- Number and class of shares
- Value or consideration paid (if any)
- Date and signatures of both parties
If the shares are being gifted, a nominal value should still be stated for recordkeeping.
Step 3: Pay Any Stamp Duty (If Applicable)
If the total consideration is over £1,000, Stamp Duty is payable at 0.5%. You must:
- Send the form to HMRC for stamping
- Pay the required duty
- Obtain confirmation before registering the transfer
We advise clients on when Stamp Duty applies and assist with submission where this is included in the selected service plan.
Step 4: Update the Share Register
Once the transfer is approved and (if applicable) stamped:
- Enter the change in the company’s statutory register of members
- Issue a new share certificate to the transferee
- Cancel or annotate the old certificate
These are legal requirements. Failure to update the register could lead to disputes or compliance issues.
Dragonfly Associates provides support in maintaining share registers and issuing certificates under agreed compliance plans.
Step 5: Notify Companies House (If Required)
For standard share transfers, no immediate filing is required. However, changes must be reflected in:
- The next Confirmation Statement (CS01)
- Any updated PSC register entries (if ownership thresholds are crossed)
We track these filing deadlines and assist with updates under applicable support agreements.
When Is Share Transfer Common?
- Bringing on a new business partner or investor
- Exiting founders or internal restructuring
- Inheritance or gifting of shares
- Employee equity or buy-back schemes
Each scenario may require additional legal or tax considerations. We recommend working with professionals to manage both compliance and commercial interests.
Frequently Asked Questions
Can I sell my shares without other shareholders’ approval?
Not always. Many private companies have pre-emption rights, meaning other shareholders get first refusal.
Do I need to file anything immediately with Companies House?
No, unless there is a change in directors, PSCs, or articles. The new ownership will be reflected in your next Confirmation Statement.
Can Dragonfly Associates handle the entire transfer?
Yes. We assist with form preparation, register updates, stamp duty guidance, and compliance support—available under select service packages.
Transfer Shares the Right Way
Share transfers affect ownership, tax, and control. Getting the details right matters.
Dragonfly Associates supports companies in managing share transfers legally and efficiently, ensuring all records and filings remain compliant. Services are available subject to agreement and scope.
If you need help transferring shares or updating your share register, get in touch with our team today.
