After your company is registered, you may require additional funds to expand your business. To invite new shareholders, you can sell them your shares. Below are some important points to note and these trivial steps can be quite time consuming. Hence, it is important to appoint an experienced TCSP service provider which is capable to provide you with on-going support at an affordable cost.
“In practice, one has to queue up at the Inland Revenue Department for around 3 to 4 hours to complete the shares transfer process even though all documents are prepared and completed.”
The actual process at Inland Revenue Department is relatively complex. To begin with the share transfer procedure, the company directors have to prepare a sales agreement on the purchase of company shares. Since it is a legal document, it is ideal to have a Hong Kong lawyer to draft or review the sales agreement. Get Started HK can provide you with a general consultation in preparing the agreement and we can also connect you with a Hong Kong commercial lawyer.
Filing of share transfer documents
After the Company agrees the terms with new investors, all parties shall sign the share agreement. The directors shall proceed to file the share transfer documents to Hong Kong Tax Department. For easy reference, the Inland Revenue Department usually requests the following documents.
- Cover Letter
- Instrument of Transfer
- Sold Note
- Bought Note
- Written Resolution signed by directors to approve the transactions
- Agreement for Share and Purchase of Shares
- Recent Audit Report or Management Account
- Company Official Documents
- Any other documents as the Inland Revenue Department deems appropriate.
The cost for share transfer documents starts at US$380 depending on complexity and number of documents needed. For details, you can reach us at firstname.lastname@example.org
Stamp Duty Estimation
On the sale or transfer of shares, there will be a stamp duty payable to the Government of the HKSAR. For Hong Kong stock, stamp duty is calculated as follows:-