How To Transfer Physical Shares

To transfer a physical share certificate to another person’s name, you would need a transfer deed.

A Transfer deed is a document that is provided to you at the time when you originally purchase physical shares. Keep it safe for use when you want to sell or transfer shares.

A transfer deed has two parts - the seller’s part and the buyer’s part.

Both the seller and the buyer need to fill their respective parts in order to give effect to the share sale. Besides these two, other parties involved in the transaction include the company registrar (RTA) and the government.

Step-by-step Process to Transfer Physical Shares

Step 1: Information to provide in the seller’s part of the Transfer Deed

This part will contain the following points:

• Name of the company
• Quantity both in figures and words
• Distinctive numbers
• Certificate number
• Name of the seller
• In front of the name of the seller you have his signature
• Witness name and signature

Step 2: Information to provide in the buyer's part of the Transfer Deed

When a buyer purchases shares, he reviews the share certificate along with the transfer deed already completed by the seller. The buyer then needs to complete his part by providing the following details:

• Consideration both in words and figures (which is quantity x price)
• Buyer's name and signature
• Buyer's occupation
• Buyer's address
• Date of purchase (which has to be after the date of the transfer deed)
• Stamp duty (which is 50 paise per Rs100 or part thereof on the value of consideration)

Read Also:- A Guide for Dematerialization of Physical Shares

Step 3: Share Transfer Stamp

Once the transfer deed is completed by both the buyer and the seller, the next step is to attach the share transfer stamps by the buyer. The same must be purchased with the government and can be found at a post office or stamp office or other authorized vendors.

The share transfer stamp is a way for the government to collect revenue on the transfer of shares. The value of the stamp is decided by the government upon the value of consideration for the shares.

The share transfer stamp must be attached in the space provided on the reverse side of the transfer deed.

Step 4: Sending to the Registrar

A Registrar and Share Transfer Agent (RTA) is the person or company that handles share purchase, sale and transfer tasks on behalf of the mutual fund house or company.

Upon completing the details in the transfer deed and attaching the stamp, the buyer needs to send the deed along with the share certificate and other documents (if needed), by post or in person, to the respective registrar to the company.

To find the registrar of a funds company, you can either contact the company itself or search Google for the same. Otherwise, you can also share the deed to the company’s address mentioned on the share certificate.

The documents must be sent to the registrar on or before the last date as mentioned in the transfer deed, also known as the deed’s validity.

Step 5: Transfer of Certificates

When the Registrar and Transfer Agent of the company receive such a transfer request, they will check the attached details to confirm the ownership and also match the seller’s signature with the one recorded with the company. They will also check if the consideration amount is right according to the stock’s market price and includes the stamp duty. Further, they will check that the deed validity if not over.

Upon confirming and validating all the things to their satisfaction, Registrar will transfer the shares in the name of the buyer and store the buyer’s signature as a specimen/sample in their records. They will also update their member register with the buyer’s name.

The duly endorsed share certificate is then sent to the buyer’s address, as mentioned in the documents.