Pursuant to the Companies Act, the transfer of a share can be with or without compensation, while under the Property Tax Act, the only tax that the transferor should pay is the capital gains tax, which is 15%. The tax base for capital gains is taxable income as the difference between the selling price of the share and its purchase price.

As the selling price, the price at which the transferor / taxpayer has acquired the share (the nominal value of the capital invested proportionally) is taken, whereby the purchase price does not include the amount for which the share increased by converting the undistributed profit into the company’s capital.