Transfer of Shares
Here are the steps on how to transfer shares in Singapore:
The transferor and transferee must enter into a share transfer agreement.
The transferor must surrender the original share certificate to the company.
The company must issue a new share certificate to the transferee.
The transferor and transferee must pay stamp duty on the transfer of shares.
The company must file a "Transfer of Shares/Update List of Members" transaction with ACRA.
Here are the documents that you will need to transfer shares in Singapore:
Share transfer agreement.
Original share certificate.
New share certificate.
Stamp duty payment receipt.
The stamp duty on the transfer of shares is 0.2% of the value of the shares being transferred. The value of the shares is determined by the average price of the shares on the Singapore Stock Exchange on the date of the transfer.
The transfer of shares must be completed within 30 days of the date of the share transfer agreement. If the transfer is not completed within 30 days, the share transfer agreement will be void.
Here are some additional things to keep in mind when transferring shares in Singapore:
The company's constitution may have additional requirements for the transfer of shares.
If the shares are being transferred to a foreign shareholder, you may need to obtain approval from the Monetary Authority of Singapore (MAS).
Shareholders can transfer shares to other shareholders. Existing shareholders can transact with an existing shareholder or with a new shareholder, subject to the provisions of the company’s constitution. Any transfer of shares will need to be in compliance with the constitution. Only fully paid shares can be transferred.
In such transactions, the company does not get paid and the transfer of shares is not initiated by the company. Nonetheless, the company must notify ACRA if there is a transfer of shares in the company by filing the “Transfer of Shares/Update List of Members” transaction.
The transfer does not take effect until ACRA updates the company’s Electronic Register of Members (EROM) to reflect the shares transaction. As shareholders are usually also members of the company, the EROM must be updated whenever there are changes in the shareholdings.
Here is information required for the process of Transfer of Shares for private/public company.
1. Unique Entity Number (UEN) 2. Date of change/transfer 3. New Shareholder's particulars 4. Shares held by each shareholder 5. Date of becoming member/date of cessation 7. Currency
Shares and Updating Share information
Here are the steps on how to update share information in Singapore:
1. Go to the ACRA website and log in to your BizFile+ account.
2. Click on "File eServices".
3. Select "Local Company".
4. Click on "Make Changes".
5. Select "Change in particulars of shareholders".
6. Enter the following information:
The company's name.
The shareholder's name.
The shareholder's identification number.
The change in particulars.
7. Click on "Submit".
The following are the changes in share information that you can update through BizFile+:
Name of shareholder.
Identification number of shareholder.
Residential address of shareholder.
Nationality of shareholder.
Type of identification document of shareholder.
Number of shares held by shareholder.
Class of shares held by shareholder.
Here are some additional things to keep in mind when updating share information:
You must update share information within 30 days of the change taking effect.
If you are updating the residential address of a shareholder who is a Singapore citizen or permanent resident, you do not need to update ACRA. The Immigration and Checkpoints Authority (ICA) will automatically update ACRA with the new address.
If you are updating the share capital of the company, you must also file a "Notice by Local Company of Alteration in Share Capital under S71" transaction through BizFile+.
A share is a portion of the company which belongs to a shareholder in exchange for his financial contribution towards the company’s share capital. A share may be fully or partially paid up.
By paying for the shares, an investor is buying partial ownership of a company and becomes a shareholder. A shareholder may be an individual, a company or a limited liability partnership.
Stamp Duty for Transfer of Shares
Stamp duty is a tax that is payable on certain documents, including share transfer documents. The stamp duty on the transfer of shares in Singapore is 0.2% of the value of the shares being transferred. The value of the shares is determined by the average price of the shares on the Singapore Stock Exchange on the date of the transfer.
For example, if you are transferring shares worth $10,000, the stamp duty payable will be $20.
There are a few exemptions from stamp duty on the transfer of shares. These exemptions include:
Transfers of shares by way of gift.
Transfers of shares to a spouse or child.
Transfers of shares to a trust for the benefit of a spouse or child.
Transfers of shares to a company that is wholly owned by the transferor.
If you are unsure whether you are liable for stamp duty on the transfer of shares, you should consult with a tax advisor.
Here are some additional things to keep in mind about stamp duty on the transfer of shares in Singapore:
The stamp duty must be paid within 30 days of the date of the transfer.
The stamp duty is payable by the transferor and the transferee.
The stamp duty can be paid online or at any Inland Revenue Authority of Singapore (IRAS) office.
Stamp duty is charged on the document signed when you buy or acquire shares by way of purchase e.g. share transfer instruments. The duty is payable on the actual price or value of the shares, whichever is higher.
Determining Value of Shares
The value of shares for the purpose of transfer in Singapore is determined by the following methods:
Market value: This is the most common method of determining the value of shares. The market value is the price that the shares would be sold for on the open market.
Net asset value: This method is used for private companies that are not listed on a stock exchange. The net asset value is the value of the company's assets minus the value of its liabilities.
Valuation: This method is used when the market value or net asset value is not available or reliable. A valuation is conducted by a qualified professional who will assess the company's assets, liabilities, and future prospects.
The method that is used to determine the value of shares for the purpose of transfer in Singapore will depend on the specific circumstances of the transfer.
Here are some additional things to keep in mind when determining the value of shares for transfer in Singapore:
The value of shares can fluctuate over time. It is important to use the most recent valuation when determining the value of shares for transfer.
The value of shares can be affected by a number of factors, including the company's financial performance, the overall economic climate, and the market sentiment for the company's industry.
It is important to get professional advice when determining the value of shares for transfer in Singapore. A qualified professional will be able to help you understand the different methods of valuation and choose the method that is most appropriate for your circumstances.
1. Shares Listed on the Stock Exchange of Singapore
The value of the shares transferred is taken to be the average price on the Stock Exchange of Singapore as at the date of the document.
When there is no available average price as at the date of the document, the latest average price of the shares can be used.
2. Shares in Private Companies
The value of the shares transferred is taken to be the net asset value (NAV) or the allotment price of the shares in the target company.
Where there are different classes of shares (e.g.: preference shares in the target company), the NAV will depend on the rights attached to the respective class of share.
a. Where the company has been incorporated for more than 18 months
For Stamp Duty purposes, the value of the shares transferred is the NAV of the target company. The NAV is computed based on the latest statement of accounts of the target company which should be dated within 24 months before the date of transfer.
Where the target company owns any property, the market value of the property as at the date of document should be used in place of the book value if the book value is not reflective of the market value.
b. Where the company has been incorporated for 18 months or less
For Stamp Duty purposes, the value of the shares transferred is the allotment price if the target company does not own any property.
Where the target company owns any property, the management accounts have to be prepared to determine the NAV of the shares.
The statement of accounts or management accounts should:
a. Reflect the market value of the property as at the date of document for the share transfer b. Be certified by the director or secretary of the company
Stamp Duty Rates for Transfer of Shares
The stamp duty rates for the transfer of shares in Singapore are as follows:
0.2% of the value of the shares being transferred. The value of the shares is determined by the average price of the shares on the Singapore Stock Exchange on the date of the transfer.
A fixed duty of $10 if the value of the shares being transferred is less than $500.
There are a few exemptions from stamp duty on the transfer of shares. These exemptions include:
Transfers of shares by way of gift.
Transfers of shares to a spouse or child.
Transfers of shares to a trust for the benefit of a spouse or child.
Transfers of shares to a company that is wholly owned by the transferor.
If you are unsure whether you are liable for stamp duty on the transfer of shares, you should consult with a tax advisor.
Here are some additional things to keep in mind about stamp duty on the transfer of shares in Singapore:
The stamp duty must be paid within 30 days of the date of the transfer.
The stamp duty is payable by the transferor and the transferee.
The stamp duty can be paid online or at any Inland Revenue Authority of Singapore (IRAS) office.
0.2% of the purchase price or the value of the shares
Stamp duty is rounded down to the nearest dollar, subject to a minimum duty of $1.
How Long it will Take
The time it takes to transfer shares in Singapore depends on a few factors, including:
The type of company. The transfer process is different for public companies and private companies.
The number of shares being transferred. The more shares being transferred, the longer the process will take.
The workload of the company secretary. If the company secretary is busy, it may take longer to process the transfer.
Typically, the transfer of shares in Singapore takes 3-5 working days. However, it can take longer if there are any delays in processing the paperwork.
Here is a breakdown of the typical timeline for transferring shares in Singapore:
Day 1: The transferor and transferee enter into a share transfer agreement.
Day 2: The transferor surrenders the original share certificate to the company.
Day 3: The company issues a new share certificate to the transferee.
Day 4: The transferor and transferee pay stamp duty on the transfer of shares.
Day 5: The company files a "Transfer of Shares/Update List of Members" transaction with ACRA.
The transfer of shares will be completed on the 5th day, assuming there are no delays. However, it is important to note that the timeline may vary depending on the factors mentioned above.
The share information will take about 5 to 20 minutes to be updated. A private company is first required to notify the Registrar of the information to be entered in the EROM using the "Update of paid up share capital" form, before the Registrar will enter into the EROM any information notified by the company to the Registrar using this form.
Fee
Filing Transfer of Shares/Update List of Members transaction is free of charge.
There is no fee to update share information through BizFile+.
How Bestar can Help
Bestar is a corporate secretarial services provider in Singapore. We can help you with the transfer of shares in Singapore by providing the following services:
Drafting of share transfer agreement. The share transfer agreement is a legal document that sets out the terms of the transfer of shares. Bestar can help you draft a share transfer agreement that is tailored to your specific needs.
Processing of stamp duty. Bestar can help you process the stamp duty for the transfer of shares. They will ensure that the stamp duty is paid correctly and on time.
Filing of transfer of shares with ACRA. Bestar can file the transfer of shares with ACRA on your behalf. This will ensure that the transfer of shares is properly recorded and that you have the legal right to the shares.
In addition to these services, Bestar can also provide you with advice on the transfer of shares in Singapore. They can help you understand the legal requirements for the transfer of shares and they can answer any questions that you may have.
Here are some of the benefits of using Bestar to help you with the transfer of shares in Singapore:
Expertise: Bestar has a team of experienced corporate secretarial professionals who can help you with the transfer of shares. They have a deep understanding of the legal requirements for the transfer of shares and they can help you ensure that the transfer is completed correctly.
Convenience: Bestar can handle all of the paperwork and filing for you. This will save you time and hassle.
Peace of mind: You can be confident that the transfer of shares will be completed correctly and that you will have the legal right to the shares.
If you are considering transferring shares in Singapore, contact Bestar to discuss your options. We can help you understand the process and we can ensure that the transfer is completed correctly.
Let me know if you have any other questions.
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