Tips on the sale and transfer of UK stocks and shares
09/11/2009
Pam Dexter, Probate Asset Services Manager, Title Research
If you have stocks and shares within an estate you will usually need to obtain a Grant of Probate (unless the estate is of low value) and you may well have used our Probate Valuation service to help obtain the Grant (or the Confirmation Certificates which are the equivalent in Scotland). Once this process is complete, the next stage is to distribute the estate in accordance with the deceased’s wishes. As far as UK stocks and shares goes this gives rise to two options.
Option 1 is to sell the shares and distribute the cash amongst the beneficiaries. This should be and sometimes is, a relatively straightforward process. Option 2, which is becoming increasingly popular, is to transfer the shares into the names of one or more beneficiaries. Whilst the process is, in theory, straightforward there are a number of pitfalls.
- In both cases it is necessary to locate all share certificates for the holding. A simple holding may have one or two certificates to support it. Certificates for some holdings appear to be missing but it may be that the shares are held electronically and certificates do not exist.
- Other holdings accrue extra shares via a dividend reinvestment plan and this can lead to a considerable number of certificates for a few shares each. A large pile of certificates may look complete but on verifying the holding it is not uncommon to find a handful of certificates have gone astray.
- Additionally, certificates which look valid can be obsolete due to a company action or share consolidation and these cannot be used to support a sale or transfer.
- Occasionally, a holding will have been acquired for cash and it may be necessary to claim the outstanding payment due to the estate which we are always happy to undertake.
The best practice approach adopted by Title Research is to verify the holdings and the validity of the share certificates prior to preparing the sale or transfer documentation. Replacement certificates can be obtained and we at Title Research undertake this at no additional cost but note the Registrars will charge both an administrative fee and an Indemnity fee which will vary according to the value of the holding.
Our staff will ensure the holdings are complete and prepare the necessary paperwork to complete the sale or the transfer(s) together with any letters of authority which may be required in order to have uncashed or retained dividend cheques reissued. The papers will, of course, need to be signed by the executors to the estate but once signed, these can be returned to us for processing.
Working with the Registrars can be time consuming and frustrating. We aim to simplify the process for you and return any reissued dividend cheques together with the new certificates, in the case of a transfer, or the proceeds, in the case of a sale, direct to you for a fixed fee per holding.
Pam Dexter
pam.dexter@titleresearch.com
+44 (0)20 7332 9074