How do I change the Wrong Share capital with Companies House

How do I change the Wrong Share capital with...

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Hi,

I've just started a new business and after a recommendation, spoke to an accountant who didn't seem knowledgeable about a lot of things which as a student taking a unit in Finance already knew, so I decided to incorporate the company myself whilst looking for another accountant. I've wrongly put the share capital down as £5000 instead of £100. I'm the sole shareholder, I'd prefer to have the share at £100 and the balance £4900 as capital loan.  Is there a way to change this please? or is it easier to dissolve company and register another. I've not started trading yet.

Thanks for reading.

Replies (6)

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By johngroganjga
19th Feb 2014 09:53

So you have filed a return saying that the company has issued 5,000 £1 shares?

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By ireallyshouldknowthisbut
19th Feb 2014 10:22

.

If you mean you have incorporated online with 5000 £1 shares, then yes I would just bin it and start again. 

However I think you need to take several steps back from that too.  You have not started trading, why have you formed a company in the first place?

ie is this even the right business structure for you? If you are just testing the business model then ordinarily you would do this as a sole trader, and then incorporate way down the line when its actually making decent money, not in the startup/testing phase. 

Rule of thumb, if you are not big enough for an accountant then you are not big enough for a limited company.

 

 

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Replying to mr. mischief:
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By tjsolent
19th Feb 2014 10:42

About to start trading

Hi, 

thanks for the advice, i'm in the process of concluding with suppliers and should start trading soon. I looked into sole trader and limited and was trying to be as tax efficient as possible, maybe i need to look into what would be more appropriate as a start up first. thanks again, you have got me thinking

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By tjsolent
19th Feb 2014 10:32

No Returns filed yet

Hi John, thanks for responding. I've just registered with companies house and where it asks for number of shares and amount paid for shares, I put in 1 and £5000, i'd like to reduce the amount so i can repay myself loan to the business

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By TerryD
19th Feb 2014 10:55

Reduction of capital

It is perfectly possible to repay share capita. You can follow the reduction of capital rules (CA2006 ss. 641-644 & the Companies (Reduction of Share Capital) Order 2008, SI 2008/1915) and repay any of your company's share capital that it no longer needs. Only the amount originally paid for the shares (including any share premium), can be repaid. The procedure requires a special resolution and a solvency statement (in the prescribed format) which must be signed by all the directors. Accompanying the solvency statement there must be a declaration by the directors that they have complied with certain procedural matters in relation thereto. These documents must be sent to Companies House along with the resolution and form SH19. There is also a fee of £10 payable.

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Replying to TerryD:
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By dipenjoshi
04th Oct 2017 18:10

Hi Terry

does this procedure still apply today?

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