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COVID-19: temporary change to buying or selling shares

View profile for Tim Field
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 COVID-19: temporary change to buying or selling shares

The government has released updated advice relating to the stamping of stock transfer forms, payment of stamp duty and the new measures put in place because of coronavirus.

As you will be aware, when buying shares in a limited company the government imposes a stamp duty charge of 0.5% of transaction, subject to certain exclusions and reliefs that are available. As a general rule the buyer will send the stock transfer form to HMRC for stamping along with a cheque for the relevant amount of duty that is payable.

From today stock transfer forms must no longer be posted to HMRC. They should be scanned and emailed to - stampdutymailbox@hmrc.gov.uk and payment of the relevant amount of duty made to HMRC. Full details of the updated advice published by the government can be found here

Whilst it is the stock transfer form that actually gives effect to the transfer of ownership of shares in a limited company, it is often wise to have an accompanying share purchase agreement. As a buyer this will give you comfort through a collection of warranties, and if appropriate, indemnities of the company shares you are buying has been operated correctly and that they own the assets that you expect, amongst other things.

If you have any queries relating to the stamping of a stock transfer form or more generally, the purchase or sale of shares in a private limited company, contact our specialist business team. 

I am based in our Colchester office and can be contacted on 01206 217366 or tim.field@birkettlong.co.uk.  

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