Can I remove a shareholder after the company is incorporated?

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Evening, we’ve just registered a limited company, but one of the guys who is registered as a shareholder is now backing out. Can we remove him as a shareholder, even though he’s on our documentation?

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Yes, you can remove someone as a shareholder any time by transferring (selling) their shares to someone else. One or more of the other shareholders in the company will have to buy the shares from the person who wants to leave the company. To do this, you have to fill out a Stock Transfer form with the following details:

  • Name and registration number of the company
  • Details of the share(s) being transferred from one person to another
  • Name and address of person who currently owns the shares
  • Name and address of person who is buying the shares from the existing shareholder

A copy of this form should be given to the person selling the shares and the person buying the shares. Each new shareholder should also be given a share certificate as proof of ownership of the transferred shares. A copy of the transfer form and each share certificate should be retained by the company for its records.

You do not need to send the transfer form to Companies House - you will report the change in share ownership on your next annual return - but you may need to send a copy to HMRC and pay Stamp Duty if the sale value is above £1,000.

a year ago
 

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