In order to transfer shares in a limited liability company, there are a number of simple steps that you must first go through.

Firstly, the seller or buyer must complete a stock transfer form (often called a share transfer form). The layout and structure of this form is prescribed under legislation. As such, it’s important that you use the correct form. The form will need to be completed by inserting details of the name and address of each of the seller and the buyer, the number and type of shares being transferred, the company in which the shares are held, the price being paid for the shares, if any, and so on. Once the stock transfer form has been completed, the seller will need to execute it.

The next step is to determine whether or not the purchaser of the shares is obliged to pay any stamp duty on the share transfer. That will depend on the value of the shares and the price paid for them. If the market value of the shares being transferred or the consideration being paid for the shares is above €1,000, it will be necessary to pay stamp duty on the stock transfer form. Stamp Duty (at the date of writing) is currently chargeable at the rate of 1% of the higher of the consideration paid or the market value of the shares – provided the value is above €1,000.

Where stamp duty becomes payable, the stock transfer form will need to be presented to Revenue (in Dublin Castle) together with a Revenue Form SD4 and a bank draft form the amount of stamp duty owing. Once received, the Revenue will impress a stamp on the stock transfer form to indicate that the required stamp duty has been paid.

Once the stock transfer form has been stamped, or it has been determined that the stock transfer form is exempt from the requirement to impress it with stamping, it will then need to be presented to the board of directors of the company. The board must convene a meeting at which it must then (i) approve the share transfer, (ii) authorise the share transfer to be reflected in the statutory books (Register of Shareholders) of the company and (iii) authorise the issue of revised share certificates to the then current shareholders – including the purchase of the transferred shares.

The company’s board of directors should not register the share transfer without first receiving either the original share certificate held by the seller or, if it cannot be produced, an indemnity from the seller in order to allow the company issue a duplicate share certificate for the purposes of facilitating the transfer of the shares.