Selling Your Shares Back to the Company - FAQs



UPDATED: March 2022





Selling Your Shares Back to the Company - FAQs - Share buybacks (aka Share Repurchases, or Stock Buybacks) are a great way for the company to raise the price of its shares and reward its investors and shareholders. Most shareholders who engage in selling your shares back to the company have many questions regarding the process, and we have done our best to answer their queries here. Are you interested in selling your shares back to the company?





Selling Your Shares Back to the Company - FAQs





You obviously will have many questions surrounding whether it is a good idea to engage in selling your shares back to the company. We have compiled a list of the most frequently asked questions when selling your shares back to the company.





1. Why Should I Sell Shares Back to the Company?





If you have worked in the company for a long time and are leaving or retiring, it makes sense to sell your shares back to the company. That way, you can get the maximum value of the shares paid by the company and don't have to hunt for third-party investors who want to purchase the shares. If you're interested in share buybacks and want to get the most value for your shares, selling them back to the company will be your best option.





2. Is the Company Allowed to Repurchase Its Shares?





Yes, the company is allowed to buy back their shares unless the company's articles of association prohibit them from doing that. There will be a written contract that will inform you whether your company is legally obliged to repurchase its shares. Private companies have special procedures and rules for repurchasing their shares.





3. Who Will Authorize the Share Repurchase by the Company?





In general, the directors of the company will decide whether they should repurchase the shares, and before they do that, they will check if the shares have been paid up. They will also check whether the company is allowed to repurchase the shares, and apart from that, they will check the shareholder resolution to decide if share repurchase makes sense for them.





4. What Will Be My Tax Consequences If I Sell My Shares Back?





If you have sold your shares on their original price back to the company, the money will be treated as a dividend and will only be subject to income tax. You won't need to worry about paying any additional taxes on the money collected by you from selling your shares back to the company. That is why so many people choose to start selling your shares back to the company.





5. What Happens to Repurchased Shares?





Repurchased shares can either be canceled immediately by the company, or held in the treasury. It is generally up to the company to decide what it wants to do with the shares that it has repurchased, and it doesn't concern the person selling your shares back to the company.





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About the Author & How YOU Can Profit: This article is the copyrighted product of the team at BuybackAnalytics.com .





Buyback Analytics is a Top Tier Investing Platform to help investors find, analyze, and profit from investing opportunities not found through traditional investment tools. We specialize in this simple concept:  Follow the trades of Insiders - CONSISTENTLY PROFITABLE Traders, Investors, and Institutions because THEY get Inside Information that YOU don't:





LEGAL Insider Trading / Inside Traders (CEOs, CFOs, Corporation's Accountants & Attorneys, Politicians, etc.)
Stock Buybacks (Share Repurchases) by Public Corporations (ie. Apple, Tesla, Netflix, Meta (Facebook), Microsoft, etc.)
Market Moving Institutions (Examples: Market Makers, Investment Banks, Stock Brokerages, Hedge Funds, etc.)





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