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taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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To the Tax Advisor, I run a small Property Company with 16

Resolved Question:

To the Tax Advisor,
I run a small Property Company with 16 properties.
There are 2 Directors, myself and my wife. We each hold 100 shares, Total of 200 shares.
As we are aged 68 we want to transfer 20% of our shares to out two daughters, that is 10% each, using a share holders agreement, will there be any Tax to pay on this share transfer?
Thanking You, Ivor Jackson, Newland Properties.
Submitted: 3 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 3 years ago.
Hello and welcome to the site. Thank you for your question.

There will be a chargeable gain on transfer of shares to your daughters.

You will both be entitled to your gains annual allowance of £10,900 each and the rest will be chargeable to CGT at 18%, 28% or a combination of both depending on your total income in the tax year transfer takes place.

The gain will be based on the difference between the nominal vale of the shares in the company ( the price you paid when shares were allotted to you) and the value of the shares now based on current valuation of the company. It is important you have proper valuation done by your accountant as your company is "unlisted" i.e. a private company.

I hope this is helpful and answers your question.


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