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Shares
Share Dealing
Share dealing is the process of buying and selling shares on a recognised stock exchange.
A Shareholder
A shareholder is in effect a part owner of the company. The shareholders control the company because each share carries one vote at company meetings. The shareholders can decide on major issues concerning the company and could also vote in new directors to run the company if they wanted to. Shareholders are not liable for the debts of the company.
Buying and Selling Shares
Buying and selling shares is much simpler nowadays with Internet and phone-based stock broking services. A share will normally have a price for buying and a different price for selling. There are various ways you can buy and sell shares:
- Using the services of a stockbroker. They can also offer advice on which shares to buy and sell.
- Many banks or building societies offer a share dealing service.
- Online using an Internet based trading service
- Some solicitors and accountants offer a stock broking service.
- Some companies will occasionally give you the option to purchase shares in their company directly from them.
- It is possible to purchase shares directly from an individual; however it is important to obtain legal advice and to ensure that the relevant paperwork is properly completed.
Taxation on Shares and Shareholders
Dividends on shares are paid with an accompanying 10% tax credit, recognising that the company will have to pay corporation rate on the profits the company make. If you are a basic or non taxpayer you will have no further liability to income tax. If you are a higher rate taxpayer, however, 22.5% of the dividends received must be further taxed.
Share Advice
The price of a share varies with the demand for it in the marketplace. This demand is affected by the profitability of the company as well as the outlook and potential for growth of that company in the future. The share price will increase if a company is performing well, and will decrease if the company is performing poorly. The dividend that is paid to the shareholders is tied directly to the financial profit the company makes, but the share price changes - more subjectively - with reaction in the marketplace. For advice on share dealing and to discuss how a financial investment into the shares of a company might affect you contact us by telephone 01454 321511.