Transfer shares to family

Emily R

Registered User
Messages
17
Hello,

I have shares that I want to transfer to my Dad. Is it simply a matter of contacting my broker (Davys) to change it to his name? Would there be any tax advantages for him as he is 65 plus. Also what would be the tax implications-stamy duty? I presume Revenue would know as I have paid USC and PRSI on these from my salary. Do ye think I would I should contact a professional (solicitor?) or is it straightforward?

Thanks
 

RedOnion

Frequent Poster
Messages
4,285
Have you made a gain on the shares?
Are they Irish listed shares?

You're making a gift, at market value of the shares, to your dad.
It's a capital gains tax trigger for you. You'll pay tax on any gain. But if you've made losses, you can't use them as it's not an arm's length transfer.
He pays stamp duty on receipt.
You'll both pay broker commissions.

Why transfer shares?
Is it no cleaner to sell the shares, give cash to your dad, and let him do what he wants with it?
 

Emily R

Registered User
Messages
17
I had thought it would be tax free if it is within the yearly limit small gift exemption?
 

RedOnion

Frequent Poster
Messages
4,285
I had thought it would be tax free if it is within the yearly limit small gift exemption?
That just means your dad won't pay gift tax on receipt.

If the gain is less than your annual exemption, and you've no other gains, you won't pay CGT.

If you're planning to give him less than 3k, I'd just give the cash.
 

Emily R

Registered User
Messages
17
It would be more than 3k, they are US listed stocks and I have made a gain.

Would it I better off to just sell still and give him the cash?
 

EmmDee

Frequent Poster
Messages
392
It would be more than 3k, they are US listed stocks and I have made a gain.

Would it I better off to just sell still and give him the cash?
The transfer to your father would be calculated at the value of the shares at the time of transfer and crystallises your gain so there would be two potential tax implications;

(1) The difference between the value you obtained the shares and the value you transfer is a capital gain. If it's above your allowance you would owe CGT - assuming no other activity such as other losses you could offset

(2) Any value over the tax free gift allowance would be taxable under gift tax - owed by your father.

Unless there is a reason for your Dad holding the shares (e.g. future income streams), it would seem easier to sell the shares and transfer in cash. There mat be some exemptions e.g. If the cash is being used for medical purposes if your Dad was incapacitated.

You could cash the shares and split the gift to your Dad to avoid gift tax - €3k this year and then another €3k next year and so on.
 

RedOnion

Frequent Poster
Messages
4,285
so there would be two potential tax implications
Absolutely. The only thing to add is that where there is CGT & CAT arising from the same transaction, there is a CGT credit available to the Dad, but is clawed back if he sells the shares with 2 years: https://www.revenue.ie/en/gains-gifts-and-inheritance/credits-you-can-claim-against-cat/credit-for-capital-gains-tax-cgt.aspx

Would it I better off to just sell still and give him the cash?
Personally, if I was providing finance to my parents, I'd give them cash, and I would look at either:
1. An interest free loan, or
2. Setting up a covenant to provide financial support, and claiming tax relief on it
 
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