UKHow to Add New Shares and Shareholders to a Uk Limited Company
  • In a UK limited company, ownership can shift as new shareholders join or existing ones leave. These changes occur when new individuals or entities purchase shares or when existing shareholders sell their stakes. Reporting such adjustments is crucial and must be noted in the annual confirmation statement sent to Companies House. Additionally, keeping the statutory register of members up-to-date is important. Companies can bring in new shareholders either by selling existing shares or by issuing new ones. Shareholders invest in the business in exchange for a portion of ownership, typically gaining voting rights and a share of profits. Whether a company is owned by a single individual or multiple shareholders and directors, it offers flexibility in structuring a business when you register company in UK. 

Transferring shares in UK limited company 

  • To transfer shares in a company, a stock transfer form must be completed with specific details including the registered name of the company, the class and value of the stock, and the number of shares being transferred. Additionally, the form requires the names and contact addresses of both the current and new owners, any consideration paid, and any applicable Stamp Duty liability. The form must be signed by the transferor or an authorized person. 
  • If money is exchanged for the shares, the new shareholder should submit the form to HMRC and pay the necessary Stamp Duty. However, if no payment is made, filing the form is not required. 
  • If a company’s articles of association include pre-emption rights, existing shareholders may need to waive their rights to first refusal. After that, the transfer can be approved and recorded in the register of members by the directors or other relevant parties as stipulated by the articles. 
  • Upon completion of the transfer, new shareholders should receive a share certificate as proof of purchase. Both the transferor and transferee should retain copies of the stock transfer form, and the company should keep copies of the new and old certificates and the form at its registered office or SAIL address. 
  • Companies House will be informed of share transfers and new shareholders’ details through the annual confirmation statement. While early submission of the confirmation statement is advised, it is not mandatory. 
  • Tetra Consultants can help guide you through this process by providing legal drafting for necessary documents such as the articles of association. Additionally, we offer assistance in acquiring various certificates and licenses, including offshore financial licenses. Our expert services ensure a smooth transfer process and compliance with legal requirements. 

New share issuance in UK limited company 

  • When creating additional shares rather than transferring existing ones, increasing your company’s share capital is necessary. This can be accomplished by allotting new shares. Doing so is a way to raise funds without existing shareholders having to sell their shares, although it may dilute their ownership and control percentages. 
  • To allot new shares, existing members must first waive their pre-emption rights. Prospective members then submit a letter of application, which the board of directors (or members, if required by the articles) must approve. The change should be recorded in the register of members. 
  • Form SH01, or the ‘Return of Allotment,’ must be completed for Companies House and include details such as the company’s name and number, allotment dates, share class and currency, number and nominal value of shares allotted, payment details, and prescribed particulars of share rights. The form must be submitted within one month of allotment. 
  • The new members’ information should be provided in the next confirmation statement to Companies House, or sooner if preferred. If the company’s articles of association have a provision on authorized share capital and the new allotment exceeds this limit, the provision must be amended or removed. 
  • Tetra Consultants can guide clients through this process by offering expert legal drafting and compliance services. We ensure all required documentation and forms, including Form SH01, are accurately prepared and submitted on time. Additionally, our team can assist in amending articles of association as needed and advise on the implications of share dilution for existing shareholders. With our support, you can navigate these changes confidently and in accordance with legal requirements. 

Restrictions on transfer of shares in UK limited company 

  • The articles of association and shareholders’ agreement frequently include provisions that limit the transfer or issuance of shares under certain conditions. Thus, it is essential to review these documents before approving any share transfers or issuances. 
  • Common restrictions to be aware of include: 
  • Pre-emption rights of existing members: Existing shareholders may have the right of first refusal when new shares are issued, or existing shares are transferred. 
  • Authorized share capital: The company may have a set limit on the maximum number and value of shares that can be issued. 
  • Director’s authority: Directors may have the authority to approve or deny transfers and allotments. 
  • Company buy-back options: The company may have the option to repurchase shares under certain circumstances. 
  • Members can add or modify these restrictions at any time by passing a special resolution during a general meeting. 

Steps to add new shares and shareholders to a UK limited company 

Step 1: Decide whether to transfer share or issue new shares 

  • Tetra Consultants will assist you in deciding whether to transfer existing shares or issue new shares. If you choose to transfer shares, we will guide you through preparing a Stock Transfer Form. If you opt to issue new shares, we will help you prepare an application letter from the prospective shareholder and a Return of Allotment form (Companies House form SH01). 

Step 2: Pre-emption rights 

  • Tetra Consultants will help you to ensure that existing members waive their pre-emption rights if you are transferring or issuing new shares. 

Step 3: Board approval 

  • Get the board of directors’ approval for any share transfer or allotment to proceed smoothly and in compliance with legal requirements. 

Step 4: Complete forms 

  • Further while proceeding for adding new shares and shareholder to your UK limited company we will assist you with complying and filling all required documents, including the Stock Transfer Form, application letter, and Return of Allotment form (SH01). 

Step 5: Complete stamp duty 

  • Tetra Consultants will ensure a copy of the Stock Transfer Form is sent to HMRC for stamping and that the required Stamp Duty is paid if shares are being transferred for value. 

Step 6: Update statutory register 

  • Further, Tetra Consultants will update your company’s statutory registers, including the register of members and the register of People with Significant Control (PSC), if needed. 

Step 7: Issue share certificate 

  • Once shares are allotted, Tetra Consultants will ensure the issuance of a share certificate to the new shareholder as proof of ownership. 

Step 8: Notify companies house 

  • Further, Tetra Consultants will notify Companies House of the change in share ownership and PSC information either on the next confirmation statement or immediately by updating the statement. We will use the appropriate forms such as SH01, PSC01-09, and the confirmation statement to report these changes. 

Step 9: Keep records 

  • Once Companies House has been notified, Tetra Consultants will help you keep copies of the Stock Transfer Form, share certificates, and other relevant documents at the company’s registered office or SAIL address. 


  • Adding new shares and shareholders to a UK limited company can be a complex process requiring attention to legal and administrative details. Tetra Consultants can guide you through each step, from determining whether to transfer existing shares or issue new ones to ensuring compliance with statutory requirements and documentation. Our expertise ensures a seamless transition and adherence to legal obligations. 
  • Contact us to know more about UK limited company and our team will revert back in 24 hours. 

Tetra Consultants

Tetra Consultants is the consulting firm that works as your advisor and trusted partner in your business expansion. We tell our clients what they need to know, instead of what they want to hear. Most importantly, we are known for being a one-stop solution for our valued clients. Contact us now at for a non-obligatory free consultation. Our team of experts will be in touch with you within the next 24 hours.

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