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Thread: Transferring shares to a Trust

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    Transferring shares to a Trust

    Hi I'am not even sure if this is posted under the correct forum.

    Can anybody please advise on the procedure of transferring shares to a Trust.

    Thanks

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    Site Caretaker Dave A's Avatar
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    Is there any chance we could narrow this query down a bit, as it seems a pretty broad question worthy of a book as response.

    What exactly concerns you about this?
    The trouble with opportunity is it normally comes dressed up as work.

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    Gold Member Houses4Rent's Avatar
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    I think you have to sell them to the trust...
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    Diamond Member HR Solutions's Avatar
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    If you put money into a Trust - you are the Donor. The trust takes control of whatever happens. IYou have to pass resolutions within the Trust by the trustees etc etc. I presume it is very much the same with shares. And until such time the Trust has paid you out for your contribution you are entitled to this "donation"

    Therefor H4H is basically also correct that the Trust can purchase it outright or over a period of time.
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    Gold Member Houses4Rent's Avatar
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    You can donate R100k a year tax free. After that its 20% donations tax.
    So you donate that every year and then the trust can pay for the shares from that.
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    Thanks guys, I think it sort of answers my question, a follow up of course would be what are the regulations on issuing the share certificates to the Trust.

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    Hi Neilsp1, I assume you are the controlling director of the company? If so, there are only a few simple steps.
    1. Draw up a very simple deed of sale between yourself and the trust for the sale of the shares.
    2. If the total price is more that R100,000, then you merely need to specify that the price is payable in annual installments of R100,000
    3. On the effective date stated in the deed of sale (normally signature date, but whatever), cancel the existing certificate and issue a new one in favour of the trust, and enter same in the register of shareholders and the register of transfers.
    4. The company then needs to pay the Securities Transfer Tax, which is 0.25% of the total price.
    5. You the seller, in the years that you receive the price, will realise a capital gain for price less cost.

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    Thanks Clive

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