A share transfer occurs when a shareholder in a corporation sells or presents his shares to another new or existing shareholder. Let’s take a better look at the Hong Kong transfer of shares process and stamp duty in this article.
What Are The Reasons For Transferring Shares?
A shareholder's departure or retirement is a common reason for a transfer of shares. Here are some further justifications for why Hong Kong requires share transfers:
A shareholder wants to leave the company and recoup their investment
Business restructuring
Adjusting the current share distribution among shareholders
Shares are gifted to a partner or family member
Selling the company
What Are The Required Documents For Hong Kong Transfer of Shares?
You will need to prepare a number of documentation when transferring shares in a Hong Kong company, such as:
Transfer application form
Share certificate(s)
Written consent from the other shareholders
Stamp duty (Hong Kong transfer of shares)
Transfer fees
It will make the procedure much smoother and less difficult if you have all of these paperwork available before submitting your transfer application.
Things To Consider When Transferring Shares In Hong Kong
The following conditions must be taken into account while transferring shares of a company:
Check the articles of association for any restrictions or limitations on the transfer of shares.
Check the shareholder’s agreement of the company for any limits or limitations.
Verify that the transfer has been approved by a board resolution or general meeting resolution.
Check to see if shares have been offered for sale by other shareholders.
Steps On How To Transfer Shares of Hong Kong Company
Before a transfer of shares can take place, these steps must be followed.
Verify that any pre-emptive rights specified in the corporation's articles of association have been satisfied or waived, and get the shareholder's consent before transferring shares.
Make the appropriate share transfer documents in order for the transfer to go through.
Prepare all necessary paperwork for the Hong Kong government's stamping (stamp duty Hong Kong transfer of shares)
Once every document has been successfully stamped, the process is completed.
What Is Stamp Duty On Share Transfer?
The Hong Kong government will charge a stamp duty for Hong Kong transfer of shares when you transfer your desired amount of the company’s stock.
Stamp duty Hong Kong transfer of shares, which is calculated at 0.26 percent of the transferable consideration or the shares' net asset value, whichever is higher. There is an HKD 5.00 stamp duty charge for each transfer document. No Hong Kong business is excluded from this transaction.
When Should I Pay For Stamp Duty?
If the sale or purchase of shares occurs in Hong Kong, stamp duty Hong Kong transfer of shares must be paid within two days. If the sale or purchase occurs outside of Hong Kong, stamp duty must be paid within 30 days.
What Is The Penalty For Late Stamp Duty?
Penalties may apply if stamp duty Hong Kong transfer of shares is not paid within 30 days and may include the following. You will be charged twice as much in stamp duty if the deadline for paying it has not yet passed one month. You will be required to pay four times as much in stamp duty if you were late for more than one month but less than two months. You might be responsible for up to ten times the amount of stamp duty in any other circumstances.
Who Can Assist You In Processing Stamp Duty Hong Kong Transfer Of Shares?
Taking care of stamp duty Hong Kong transfer of shares is an easy feat with the help of SJH Global. Not only can they guide you through the entire incorporation process, but they can also provide you with their complete suite of corporate services.
If you require assistance with share transfers or the management of your company in Hong Kong, don't hesitate to get in touch with SJH Global. With the help of SJH’s company secretarial services, their experts will be there for you every step of the way to make sure that the entire process goes smoothly, on schedule, and with the correct paperwork.
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