Share Transfer Agreement and Stock Transfer Form Ireland

Two documents do two jobs in an Irish share sale. The instrument of transfer, usually a stock transfer form, is what the company acts on: under section 94(4) of the Companies Act 2014 it cannot register a transfer unless a proper instrument has been delivered. The share transfer agreement is the contract behind that form. It says what the buyer pays and when, what must happen before completion, which documents change hands and what the seller promises. A one-page transfer form says nothing about a deferred price, a refused registration or a seller who turns out not to own what was sold, which is why this template attaches the form as Schedule 1.

The agreement is lighter than a share purchase agreement for a whole business, with its disclosure letter, tax deed and weeks of due diligence. It also differs from an allotment of new shares under section 69, which attracts no stamp duty, and from a shareholders' agreement, which governs the members' relationship over time. The constitution and shareholders' agreement sit among our Irish company and business templates.

The starting point is section 94 of the Companies Act 2014. A member may transfer shares by an instrument in writing in any usual or common form, subject to the constitution. The transferor alone signs where the shares are fully paid; for partly paid shares the transferee signs too. The transferor remains the holder until the transferee's name is entered in the register of members (section 94(3)). The Stock Transfer Act 1963 allows a simpler form, signed by the transferor alone and not witnessed, but only for fully paid shares.

Registration is not automatic. Under section 95, save where the constitution provides otherwise, the directors of an LTD may decline to register a transfer in their absolute discretion. That power lapses two months after the transfer is delivered, except where the fee is unpaid, the certificate is missing or the transfer covers more than one class (section 95(2)), and a refusal must be notified to the transferee within two months after the transfer is lodged. Many constitutions also give members a right of pre-emption, to be followed or waived in writing. Once a duly stamped transfer is lodged, section 99(2) gives the company two months to have the new certificate ready.

Stamp duty is charged on the instrument at 1% of the consideration, and the buyer pays it through a ROS return; Revenue charges no interest or surcharge if the return is filed and the duty paid within 44 days of signing. Revenue's page on stamp duty on transfers of shares in Irish companies explains the exemption for a consideration of 1,000 euro or less, lost where the sale is part of a larger transaction or the shares draw the bulk of their value from immovable property, and claimed by a certificate the buyer signs on the form. Section 30 of the Stamp Duties Consolidation Act 1999 substitutes market value for a sale at undervalue. After registration, a change of beneficial owner goes to the RBO within 14 days, and the new membership appears in the next annual return under section 343.

The most frequent use is a co-founder exit. Two people set up a company, one leaves, and the other buys the departing stake, often in instalments, which the deferred payment option covers. Succession in a family company comes next: a parent sells part of a holding to a son or daughter already working in the business, sometimes alongside employment contracts and HR documents for the new role. A third case is a minority investment, where a key manager or a long-standing adviser buys from an existing member instead of subscribing for new shares.

If the other members have not yet waived their pre-emption rights, completion cannot happen on signing, so the template lets you set a later completion date with conditions and a firm exit if they fail. Where the seller sits on the board, the sale and the resignation usually go together. Two edge cases need a solicitor's view. A company whose value comes mainly from non-residential property in Ireland can face a higher charge under section 31C. Separately, where the shares derive their value from Irish land and the price exceeds 500,000 euro, the buyer must withhold 15% unless the seller produces a CG50A clearance certificate.

The agreement opens with the parties, the company's CRO number and registered office, and a definition of the shares by number, class, nominal value and certificate number. The price clause offers payment in full at completion or a part payment with a Deferred Price, which carries interest at 8% a year if late and falls due at once if the buyer defaults or becomes insolvent. A separate clause covers pre-emption waivers and the directors' approval, and spells out the section 95 timetable.

At completion the seller hands over the signed stock transfer form, the share certificate or an indemnity for a lost one, any waivers, a certified copy of the board resolution approving the transfer and a proxy in favour of the buyer. Until registration, the seller holds the shares on trust for the buyer and votes as the buyer directs, which covers the gap left by section 94(3). If the directors refuse to register, or nothing happens within two months of lodging, the buyer can end the agreement and recover what was paid. Most homemade share transfer agreements forget that clause.

Warranties come in two levels. Title and capacity warranties are always given: the seller owns the shares outright, they are fully paid and free from any charge, and no bankruptcy or insolvency arrangement exists. You can add limited business warranties on accounts, tax, disputes and statutory registers, with a claim period in months. Liability is capped at the price, except for fraud. Capital gains tax stays with the seller, stamp duty with the buyer, and a resigning seller signs the letter in Schedule 2.

You start with the company: its registered name, CRO number and registered office. The next screens ask for the seller and the buyer, with names as they appear in the register of members and postal addresses including the Eircode. The shares come next, by number, class, nominal value and certificate number. Then you give the price and choose how it is paid; a deferred payment opens an extra screen for the amount paid at completion and the date of the balance. Choosing a later completion reveals a completion date, and the conditions appear in the preview. The last questions cover warranties, with a claim period if you keep the business warranties, and whether the seller resigns as a director.

Move through the screens with Next and Back, then click Finish to download the agreement in Word or PDF. Schedule 1 is already filled in with the same details. Other forms for Irish companies and individuals sit in our library of Irish legal documents.

Ignoring the constitution is the most expensive mistake. A buyer who pays first and then finds a pre-emption clause can watch the directors refuse registration while the seller still owns the shares in law. Read the constitution and any members' agreement built from our constitution and shareholders' agreement templates for an LTD, collect written waivers and get the board resolution before money moves. Close behind is the forgotten stamp: the form sits in a drawer, the 44 days pass, interest runs from signing, and the company will not register an unstamped transfer. A "friendly" price to a relative does not shrink the duty either, because Revenue can charge on market value.

Selling directors make their own errors. Nobody tells the CRO, although section 149(8) requires notice within 14 days, or the resignation leaves a sole director who is also secretary, which section 129(6) forbids. Check the board before the resignation letter is signed. A last trap: the stock transfer form cannot be used for partly paid shares, which need a full instrument signed by both parties.