Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Share Capital definition

What does Share Capital mean? In practice, share capital is the equity a company raises by issuing shares to its members. It records the nominal (par) value of shares allotted since incorporation and underpins shareholder rights, pre-emption on new issues, distributions and capital maintenance. Across England & Wales, Scotland and Northern Ireland (Companies Act 2006) and Ireland (Companies Act 2014), “share capital” is a widely used statutory and accounting term rather than a single defined expression. Key features include: - Issued (allotted) share capital is stated at nominal value and is distinct from any share premium. - On the balance sheet it appears as called-up...

Authorised (legacy), allotted and issued share capital compared: definitions, called-up/paid-up/subscribed capital, and PLC trading certificate and s656 net assets meeting trigger under the Companies Act 2006

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Practice notes

There are various types of Share Capital and the main differences are summarised below:

Authorised share capital – Generally obsolete from 1 October 2009, as companies no longer require authorised share capital. Nevertheless, it can still be relevant to companies (i) incorporated under earlier legislation or (ii) where shareholders wish to restrict directors’ powers to issue and allot shares; in that situation, it sets the maximum number of shares that directors are permitted to allot.
Issued share capital – Holders of issued shares are able to exercise their membership rights.
Allotted share capital – Holders have an unconditional entitlement to be entered on the Register of members (section 558 of the Companies Act 2006 (CA 2006)), but they are not yet entitled to exercise membership rights.

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Web page updated on 21/05/2026

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