What is a statement of capital?
Registering a statement of capital at Companies House is a new requirement introduced on 1.10.2009 when the main provisions of the Companies Act 2006 came into effect. A statement of capital must be sent as part of the application to register a new company and whenever the issued share capital of the company is changed, e.g. on the allotment of new shares, a buy-back of shares, etc. It is also part of the annual return every company has to register each year.
Though mentioned in the Act as a separate statement, it is in fact a constituent part of the main form being sent. For example, the statement of capital on formation is part of the Form IN01 which contains much of the other information that has to be supplied to have the company registered. When issuing new shares, the statement of capital is part of the Form SH01 (the return of allotments).
The purpose of the statement of capital is to provide full details of the company's issued share capital as at the date of the statement. The required information is:
- the total number of shares of the company,
- the aggregate nominal value of those shares, for each class of shares,
- 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) and
- the prescribed particulars of the rights attached to each class of shares.
The prescribed particulars are:
- particulars of any voting rights attached to the shares, including rights that arise only in certain circumstances;
- particulars of any rights attached to the shares, as respects dividends, to participate in a distribution;
- particulars of any rights attached to the shares, as respects capital, to participate in a distribution (including on winding up); and
- whether the shares are to be redeemed or are liable to be redeemed at the option of the company or the shareholder.
Companies House has received many complaints about these requirements and the contents of the statement of capital are under review. In the meantime, Companies House has issued some guidance on this area.
Company Law Solutions can provide practical assistance in these matters.