Company Formation FAQ - Statement of Capital

The statement of capital is a "snapshot" of a limited company's issued share capital at a given time.

Companies incorporating as limited by shares (whether private or public) on or after 1st October 2009 must complete a statement of capital and initial shareholdings as part of the application to incorporate.

All companies limited by shares must complete a statement of capital as part of any annual return filing made up on or after 1st October 2009.

A statement of capital must also be completed with certain forms associated with notification of capital changes, namely: -

• Allotment of shares;
• Notice of consolidation, sub-division of shares or re-conversion of stock into shares or redemption of redeemable shares;
• Redenomination of shares;
• Reduction of capital as a result of redenomination;
• Cancellation of re-purchased shares or, (for plcs), immediate cancellation of shares re-purchased into treasury;
• Subsequent cancellation of shares held in treasury by a plc;
• Cancellation of shares held by or for a plc in accordance with sec. 662 of the CA 2006.

In all the circumstances listed above, the statement of capital will be an integral part of the appropriate form.

There will be certain circumstances where a company needs to file a 'standalone' statement of capital - accompanying a reduction of capital (either via the 'solvency statement' route or as confirmed by a court) and (in some circumstances) when re-registering from an unlimited to a limited company. A statement of capital form will be available for these purposes.

What is the content of the statement of capital?

The statement of capital must show with regards to the issued capital: -

The total number of shares of the company;

The aggregate nominal value of those shares;

For each class of shares: -

• Prescribed particulars of the rights attached to the shares (these will be determined in regulations and indicated on the appropriate forms);
• The total number of shares of that class; and
• The aggregate nominal value of shares of that class; and
• The amount paid up and the amount (if any) unpaid on each share (whether on account of the nominal value of the share or by way of premium).

Do I have to complete a statement of capital each time I submit one of the relevant forms?

Yes.

What if the form details several transactions (e.g. an allotment of shares over a period of time)?

The statement of capital should reflect the issued capital following the 'latest' transaction.

How can I fill in the statement of capital (e.g. in my annual return) if I cannot identify the premium on individual shares?

The statement of capital requirement in the Companies Act 2006 is intended to provide a snapshot of a company's capital structure. A statement of capital is required each year in the annual return, and whenever a company changes its capital.

We are aware that one of the details required to be included in the statement of capital can cause problems for certain companies that have a complex history of allotting shares and managing their capital structure. In particular, we understand that in certain circumstances it may not be possible or meaningful for a company to identify the amount of premium paid up on each share.