(Source Companies
House)
What is share capital?
When a company limited
by shares is formed, the shareholder/s (director/s) decide this amount.
This will be the liability of the shareholder/s if the company is bound
up. The memorandum of association (one of the documents by which the
company is formed) will state:
- The amount of
share capital, value of each share and the number of shares. If you
do not choose the default amount will be £1000 (1000 share of
£1 share each).
- Not all shares
has to be allocated at the time of formation, we normally issue one
share to each subscriber, when the company is formed. You can always
issue more later in consultation with your accountant.
- The memorandum
of association will show the names of the shareholders called subscribers
in the document.
There is no minimum
or maximum share capital for a private limited company. However, a public
limited company must have an authorised share capital of at least £50,000
(and, if it is trading, issued capital of £50,000 - see question
5).
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