- Date : 23/08/2023
- Read: 3 mins
Gifting shares may entail a transfer fee of 0.03% and 18% GST. You can opt for physical/brokerage transfer or gifting firms, making it tax-efficient.
Financial securities can be a profitable investment and a thoughtful gift for your closed ones. While there are no shares gift charges levied on gifting shares, the investor must pay a standard fee of Rs. 25 or 0.03% on each share, along with GST. The GST is applicable to the standard fee levied on gifting shares.
Read on to know more about the fees applicable and multiple ways of gifting shares!
Highlights:
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Transfer fees and GST is applicable while gifting shares to someone.
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Gifting shares can be executed physically, electronically or via specialised firms.
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Gifting shares presents a unique opportunity to impart happiness and knowledge.
Can you gift shares to someone?
The short answer to this question is “Yes”. Investors can gift shares that they have purchased for someone.
Gifting shares is a unique idea considering the increasing interest of people in making investments. The profits or returns from the shares will contribute more value to the receiver than other forms of gifts and can also spark their interest in financial securities.
What are the shares gift charges levied on gifting shares?
There are no shares gift charges applicable while gifting shares to someone. However, the investor must pay the shares transfer fee and GST associated with it. The fee will be either Rs. 25 or 0.03% of the shares’s value (whichever is maximum) and the GST rate will be 18% of the transfer fee.
For instance, an investor has 20 shares of “X” and each share costs Rs. 50. The total value of the shares would be Rs. 1000.
0.03% of the total value will be Rs. 30, which is greater than Rs. 25. Therefore, the investor will pay a transfer fee of Rs. 30 and GST of Rs. 5.4 (18% of Rs 30) while gifting these shares.
Also Read: These shares brokers have the lowest brokerage for gifting shares!
How to gift shares to someone?
You can gift shares in the following ways:
- Transferring the ownership of the shares via physical transfer of the shares certificate.
- Transferring the shares through a brokerage firm or individual broker, which involves an electronic transfer of shares.
- Gifting a single share to someone through firms that offer single shares as gifts.
In each of these ways, the investor must pay the fee applicable to the transfer of shares to another individual.
Also Read: Tips to ensure profits for your loved ones while gifting shares!
The bottom line
Gifting shares emerges as a tax-efficient route to provide valuable financial opportunities. With minimal charges and various transfer methods, it's a thoughtful way to spread financial awareness and happiness. Nevertheless, investors must understand that a share's future value may vary.
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