Making a Stamping Request for a Share Transfer with Form IRSD142

Purpose of Form IRSD142 Stamping Request for a Share Transfer

When you transfer shares in a Hong Kong company, stamp duty is payable on the instrument of transfer. The Form IRSD142 Stamping Request for a Share Transfer is the document used to submit a stamping application to the Stamp Office of the Inland Revenue Department (IRD). This form allows you to declare the details of the transfer, calculate the duty payable, and request that the instrument be stamped so that the transfer is legally effective and the buyer's name can be entered in the company's register of members.

The form is required for both paper submissions and for initiating an e-stamping application through the IRD's electronic system. Without a properly stamped instrument of transfer, the company may refuse to register the transfer, and the transaction is not recognised for stamp duty purposes.

Who Must Use IRSD142

Any party to a share transfer in a Hong Kong company must ensure the instrument of transfer is stamped. The form is typically completed by the transferee (buyer) or their solicitor. If the shares are listed on the Stock Exchange of Hong Kong, the duty is collected through the exchange's clearing system and the stamping is handled automatically; IRSD142 is not needed for those trades. For off-market transfers of listed shares and all transfers of unlisted shares, IRSD142 is the correct form to use.

Hong Kong Share Transfer Stamp Duty Calculation

Stamp duty on a Hong Kong share transfer is payable at a fixed rate on the consideration or the value of the shares, whichever is higher. The current rate is 0.13% of the consideration (or value) payable by the buyer and the same rate payable by the seller, making total duty of 0.26%. No duty is payable if the consideration and the value are both zero, but the instrument must still be presented for stamping to obtain a certificate of non-liability.

When completing IRSD142, you must state the consideration in Box 11 and, where applicable, the market value in Box 12. If the shares are not listed, the value is usually taken as the net asset value per share or an independent valuation. The Stamp Office may request supporting evidence of the value.

How to Complete the Share Transfer Stamping Form

Form IRSD142 requires the following key information:

• Transferor and Transferee Details: Full names, addresses and Hong Kong Identity Card numbers (or passport numbers for non-residents) of both parties.
• Company Details: The name of the company whose shares are being transferred and its company registration number.
• Instrument of Transfer Date: The date the transfer instrument was signed.
• Number and Class of Shares: The number of shares transferred and their class (ordinary, preference, etc.).
• Consideration: The amount paid or payable for the shares.
• Value of Shares: If the consideration is not at arm's length or the shares are unlisted, the market value must be stated.

The form must be signed by the transferee or their authorised agent. If the transfer is exempt from duty (e.g., intra-group transfers under section 45 of the Stamp Duty Ordinance (Cap. 117)), you should indicate the exemption claimed and attach supporting documents.

Stamp Share Transfer IRSD142 Submission Methods

You can submit Form IRSD142 either by paper or through the IRD's e-stamping system.

Paper Submission

Complete the form in duplicate and present it with the original instrument of transfer to the Stamp Office at the Inland Revenue Department. Payment can be made by cheque, cash or revenue stamps affixed to the instrument. The Stamp Office will stamp the instrument and return one copy to you.

E-Stamping

The e-stamping system allows you to submit the stamping request online. You will upload the completed IRSD142 data, pay the duty via electronic payment, and receive an electronic stamp certificate. The electronic certificate is equivalent to a physical stamp. You must still retain the original instrument of transfer for your records but it does not need to be physically stamped if you use e-stamping.

Deadline for Stamping

The instrument of transfer must be presented for stamping within 30 days after the execution date. Late stamping attracts a penalty. The penalty is calculated as follows:

• For delays up to 1 month: 10% of the duty payable.
• For delays exceeding 1 month but not exceeding 2 months: 20% of the duty payable.
• For delays exceeding 2 months: 50% of the duty payable.

If the delay exceeds 6 months, the penalty may be up to 100% of the duty. You can apply for remission of the penalty using Form IRSD127 if you have reasonable cause for the late stamping.

Exemptions and Reliefs

Certain transfers are exempt from stamp duty. The most common exemption is for transfers between associated companies (intra-group transfers) under section 45 of the Stamp Duty Ordinance. Other exemptions include transfers on the liquidation of a company and transfers to a trustee in bankruptcy. If you claim an exemption, you must state the relevant section on IRSD142 and provide supporting documents.

Related Forms

If you need to withdraw a submitted e-stamping application for a share transfer, use Form IRSD141. If you wish to cancel a stamp certificate that contains errors, use Form IRSD140. For a full list of stamp duty forms, visit the Inland Revenue Department website at https://www.ird.gov.hk/eng/paf/bus.htm. The Stamp Office publishes guidance notes for completing IRSD142 on the same site.