Deed Of Gift Of Shares Template for England and Wales

A deed of gift of shares is a formal legal document that lets you give ownership of company shares to another party without receiving payment in return. Under England and Wales law, this deed creates a binding legal obligation and serves as evidence of your intention to make a gratuitous transfer of your shareholding once it is signed, witnessed and delivered as a deed.

What is a deed of gift?

A deed of gift is any deed that records the voluntary giving of an asset for no consideration. People use one to give shares, but the same principle applies to other property such as money, a vehicle, land, a house or an interest in real property. Because there is no payment, the gift is documented as a deed rather than a simple contract, so that it is legally binding without the exchange of value that a normal contract needs. This page covers the share version; the drafting is tailored to a company shareholding.

Deed of gift for shares versus property

The word "deed" covers several documents, so it helps to be clear on which one you need before you draft. A deed of gift of shares moves a company shareholding, while a deed of gift of property (sometimes called a gift deed or property deed) moves a house, land or another physical asset. The table below sets out how the two differ.

This page and template cover the shares version.

When do you need this document?

You need a deed of gift of shares when giving shares as part of family succession planning, particularly when passing business interests to children or relatives. It is commonly used in tax planning to take advantage of annual gift allowances or to reduce inheritance tax on your estate. It is often part of a lifetime gift made while the donor is alive rather than a transfer under a will. Corporate restructuring also calls for this deed when reorganising shareholdings between related companies or moving shares into an employee benefit trust. You may also need it when making a charitable donation of shares or settling a family arrangement involving business interests.

How do you sign and complete a deed of gift?

To be valid, the deed must be executed as a deed under the relevant formalities: each party signs in the presence of a witness who also signs, and the deed is then delivered. Record the full name of the donor and the recipient, the number of shares being given and the class of those shares, so the gift is unambiguous. Alongside the signed deed you complete the appropriate stock transfer form and submit both to the company so the gift can be registered and a new share certificate issued. The company updates its register of members, at which point the recipient becomes the legal owner. Keep a copy of the signed deed and the updated register as evidence of the gift.

Key legal considerations

The deed must clearly identify the donor's legal ownership and unrestricted right to give the shares. Include warranties confirming the shares are free from encumbrances, charges or third-party claims. Specify whether the gift includes any accrued dividends, and set out any restrictions on the recipient further transferring the shares. Check the company's articles of association, which may contain pre-emption rights or restrictions that affect the validity of the gift. Tax implications matter too, including potential capital gains tax for the donor and inheritance tax consequences if the donor dies within seven years of making the gift. If you also hold shares alongside co-owners, a shareholder agreement may set out approval steps that apply before a new shareholder can be admitted.

Cost of a deed of gift

Drafting a deed of gift through external counsel carries a professional fee that varies with the value and complexity of the shareholding. GenieAI drafts, reviews and helps you sign the document without that per-document cost, so you keep the essential formalities right while controlling spend. Where the gift is straightforward, the main outlay is usually the time to gather the share details and arrange witnessing rather than a large legal bill.

Legal requirements in England and Wales

Under the Companies Act 2006, a share transfer must be properly documented and registered with the company to be legally effective. The deed must be executed under the Law of Property (Miscellaneous Provisions) Act 1989, with signatures from all parties in front of witnesses. You must complete the appropriate stock transfer form in line with the Stock Transfer Act 1963 and submit it with the deed to the company for registration. The Financial Services and Markets Act 2000 may add requirements where the company is regulated or publicly listed. Stamp duty considerations apply under current legislation, though gifts between individuals are usually exempt. Make sure the deed is consistent with the company's constitution and any shareholder agreement that restricts transfers or requires board approval for new members. If you are drafting a range of company documents, browse related document templates to keep your records consistent.