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How can I give a parcel of shares to my kids?

I would like to give my two children a parcel of shares each, that I already hold personally. I have been informed that I’ll need to fill in an off market transfer form. However, on reading the form it requests details like buyer’s name and amount of consideration. Also I have been informed that there is a $190 transfer fee for each parcel of shares.

Is there an easier way of transferring shares free of charge to my sons as a gift?

What a great parent and what a fantastic, useful present for children. I talked to Mark Southwell Keely, stockbroker from Sydney’s Select Equities and they said they can organise off market transfers. He thought the charge was around $35 per transfer. And unfortunately there’s no easy way around the paperwork, which must be completed.

Also be aware that you could trigger a capital gains tax issue if your shares have increased in value.

Maybe a word to a broker, accountant or adviser might highlight some of the things you should be thinking about. One of my colleagues said you could also think about selling your shares for $20 a trade and then buying them back in your children’s names.

Some people buy shares for their kids within a trust, but that involves the expense of setting up a trust. Doing something really nice for your children can open up a can of worms if you’re trying to do it inexpensively.

For advice you can trust book a complimentary first appointment with Switzer Financial Services today.

Important information: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before acting, consider the appropriateness of the information, having regard to the individual’s objectives, financial situation and needs and, if necessary, seek appropriate professional advice.

Published on: Friday, February 24, 2012

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