A share for share exchange is where shareholders exchange shares for shares in another company, rather than for cash. The mechanics in Inform Direct depend entirely on which of these actually describes your situation — read this guide as a description of the building blocks available, not a fixed sequence of steps to follow regardless of your circumstances. If you're not sure which pattern applies, confirm with your solicitor or accountant what needs to happen before recording anything, since the two scenarios below use different transactions and getting this wrong can be difficult to unpick afterwards.

Scenario 1: A new company issues shares in exchange for shares in an existing company

For example, inserting a new holding company above an existing trading company, or an acquirer issuing its own shares instead of cash to buy another company.

1. In the existing/target company, transfer the shareholders' shares to the new/acquiring company, selecting "Non-cash" as the consideration and describing it as the new shares being received in exchange (e.g. "100 ordinary shares of £1.00 each in Newco Ltd").
2. In the new/acquiring company, allot the new shares to the shareholders, selecting "Fully non-cash" or "Mixture of cash and non-cash" as the consideration, describing it as the shares given up (e.g. "100 ordinary shares of £1.00 each in Target Company Ltd"). See How to add non-cash consideration details when allotting shares.
3. Both the transfer and the allotment should be dated to reflect when the exchange actually completed.
4. The allotment is filed to Companies House via SH01, through Inform Direct. The transfer in the existing company isn't filed separately (transfers aren't reported until the next confirmation statement).
5. If the exchange also involves further changes to either company's share structure (for example, reclassifying share classes or reducing capital as part of a wider reorganisation), these are recorded as their own separate transactions — see How Do I Convert One Class of Shares Into Another?, as applicable.

Scenario 2: Two existing, unconnected companies — shareholders simply swap existing holdings, with no new shares issued anywhere

Here there's no allotment in either company — each shareholder is transferring shares they already hold, and receiving shares in the other company as their consideration, rather than cash. This means recording two separate share transfers, one in each company:

1. In Company X, transfer Shareholder A's shares to Shareholder B, selecting "Non-cash" as the consideration and describing it as the shares received in exchange (e.g. "500 ordinary shares of £1.00 each in Company Y Ltd").
2. In Company Y, transfer Shareholder B's shares to Shareholder A, in the same way, describing the shares received from Company X.
3. Both transfers should be dated to reflect when the exchange actually completed. Neither company files anything with Companies House for a share transfer itself (transfers aren't reported until the next confirmation statement).

In both scenarios: board and shareholder resolutions relating to the exchange are not filed with Companies House as standard, and Inform Direct doesn't have a route to file one on your behalf — if you need to file one, this must be done directly through Companies House's own filing service.

A common pitfall: if a share for share exchange is executed by a solicitor outside Inform Direct — particularly where multiple filings happen on the same day — Companies House sometimes only registers one of two same-day SH01s. This can leave share classes duplicated or unreconciled in Inform Direct. If this happens, contact Inform Direct support: the fix is to merge the duplicated share classes, then rebuild the underlying transactions individually to match what actually happened.

Tax and stamp duty: Share for share exchanges can potentially qualify for stamp duty relief (Finance Act 1986, s.77) and Capital Gains Tax reorganisation relief (TCGA 1992), but both depend on specific conditions being met (such as shareholders ending up with mirror-image holdings, and the exchange being for genuine commercial reasons rather than tax avoidance). This is general background only, not tax or legal advice — confirm with a solicitor or accountant how these rules apply to your specific transaction, and exactly which of the above scenarios (or another structure entirely) matches what you're doing, before recording anything.

Worked example — inserting a new holding company

Alex and Priya each hold 50 £1 Ordinary shares in Acorn Trading Ltd (100 shares in issue). They want to insert Acorn Holdings Ltd above it, so they hold shares in the new holding company instead, in the same proportions, without changing who ultimately owns what.

1. Acorn Holdings Ltd is incorporated (or an existing shell company is used).
2. In Acorn Trading Ltd, Alex and Priya each transfer their 50 shares to Acorn Holdings Ltd, with the consideration recorded as non-cash: "50 ordinary shares of £1.00 each in Acorn Holdings Ltd."
3. In Acorn Holdings Ltd, 50 shares are allotted to Alex and 50 to Priya, with the consideration recorded as non-cash: "50 ordinary shares of £1.00 each in Acorn Trading Ltd."
4. Once both steps are recorded, Acorn Holdings Ltd owns 100% of Acorn Trading Ltd, and Alex and Priya hold their original proportions in the new top company instead.
5. Alex and Priya should confirm with their accountant in advance whether this exchange qualifies for stamp duty and CGT reorganisation relief, since the conditions (such as ending up with mirror-image holdings) need to be met by how the transaction is structured, not just how it's recorded afterwards.
6. PSC implications: before the exchange, Alex and Priya were each individually registered as PSCs of Acorn Trading Ltd (each holding more than 25%). After the exchange, they no longer hold shares in Acorn Trading Ltd directly — Acorn Holdings Ltd does, as its 100% owner — so Acorn Trading Ltd's PSC register needs updating to cease Alex and Priya and instead register Acorn Holdings Ltd as a Relevant Legal Entity (RLE), since it's a UK company required to keep its own PSC register. Alex and Priya instead become PSCs of Acorn Holdings Ltd itself (each still holding more than 25% there). Both companies' PSC records need updating to reflect this — this isn't automatic, and the PSC rules have enough nuance (for example, if the new holding company weren't UK-incorporated) that it's worth confirming the correct treatment for your structure before filing.