Stamp duty on new shares ?

terraces

Hi,

I've checked various threads on the forum and read CRO documentation but I'm still looking for help regarding the following issue.

I've incorporated a Ltd. in august, with 1 share issued (1€).
There's no capital in the company at the moment, but I'm about to put a few K€ in it for running costs and first bills. Do I need to (1) issue new shares when I put this amount and (2) declare the new capital to revenue. If so, what will be the taxation / stamp duty ?

Furthermore, after this capital being introduced, I will distributed some shares (no-cash) to various people. Same question regarding the stamp duty / taxation: is there any ? Can I also sell shares at the same time (and in that case, will there be some taxes on the sold shares, or on all of them).

Finally, is that better to put the capital before or after ? I.e. (1) putting some money and creating new shares, then distributing them or (1) creating shares, distributing then, and adding these €.

Does it change something regarding taxation and stamp duties, both for myself and future shareholders ? I'm trying to find the best way to minimise taxation while (1) improving capital (own-funding) and (2) issuing / distributing new shares.

Any help would be appreciated, thanks !

dbran

Hi

The payment of stamp duty on the issue of new shares (or capital duty as it was called) was abolished in December 2005.

There is stamp duty on the transfer of new shares of 1% if the proceeds of the share transfer are greater then €1000. If the transfer is less then €1000 it must not form part of a series of transactions which total more the €1000.

If the money is required for working capital you can always lend the money to the company without having to issue shares. In this way the company can pay you back at a later stage. If it is included as part of a share issue the money is basically locked into the company and cannot usually be paid back afterwards.

Hope this helps

dbran

terraces

Hi,

dbran wrote: »

Hi

The payment of stamp duty on the issue of new shares (or capital duty as it was called) was abolished in December 2005.

There is stamp duty on the transfer of new shares of 1% if the proceeds of the share transfer are greater then €1000. If the transfer is less then €1000 it must not form part of a series of transactions which total more the €1000.

So, if I'm issuing new shares either for myself or new investors, and even if they bring cash, there's no stamp duty at all ? But, there is a stamp duty (1%) if I'm transferring some of the shares that I own ?

Basically:
- Issuing 4999 shares to myself, 5000 to other people (bringing cash for some of them) -> no stamp duty
- Issing 9999 shares to myself, then transferring some -> stamp duty ?

Do I get it right ?

dbran wrote: »

If the money is required for working capital you can always lend the money to the company without having to issue shares. In this way the company can pay you back at a later stage. If it is included as part of a share issue the money is basically locked into the company and cannot usually be paid back afterwards.

Hope this helps

dbran

Ok, thanks.
It helps, indeed

dbran

Yes this is correct.