Forming a limited company – what is a statement of capital?

A statement of capital is an official record that provides details of a company’s issued shares and their status at a specific date.

It’s part of the documentation completed during the company incorporation process and is also required in connection with various changes to a company’s share capital.

The statement provides a snapshot of the number and types of shares issued, the rights associated with each share class, their nominal value and currency, and any amount unpaid on the shares.

When must you complete a statement of capital?

First introduced in October 2009 under the Companies Act 2006, companies with share capital must complete a Statement of Capital and Initial Shareholdings as part of the incorporation process.

You can view all the relevant fields on Form IN01, the paper equivalent of the Companies House incorporation process.

A statement of capital is also included with a number of Companies House forms when a company’s share capital changes.

For example:

• SH01 – allotment of new shares
• SH02 – consolidation or subdivision of shares, reconversion of stock or redemption of redeemable shares
• SH05 and SH06 – cancellation of shares
• SH14 and SH15 – redenomination of shares and certain related reductions of capital
• SH19 – certain reductions of share capital and, in some circumstances, re-registration from unlimited to limited

In many cases, the statement of capital forms part of the relevant filing rather than being submitted as a separate document.

What to include in a statement of capital

The document must include the following details:

• The total number of issued company shares.
• The total nominal value of the company shares.
• The share class or, in the case of different types, the share classes.
• For each class, the total number of shares and their aggregate nominal value.
• The aggregate amount unpaid on the shares, if any.
• The prescribed rights attached to each class of share.
• The currency in which the shares are denominated.

Total number of issued company shares

Most small companies limited by shares are set up with only one class of shares, usually ordinary shares.

In this instance, the shares will often carry equal voting and dividend rights, although the precise rights depend on the company’s Articles of Association.

The situation gets more complex if multiple share classes are issued, and the statement must include the number and rights of each class.

Aggregate nominal value

This is the total nominal value of the shares in each class. The number of shares in the class is multiplied by the nominal value of each share.

For example, 100 ordinary shares with a nominal value of £1 each have an aggregate nominal value of £100.

The nominal value can be different from £1 and does not represent the market value of the shares.

Share classes

Companies with different share classes are required to give details of the rights attached to each class.

These may include voting rights, dividend rights, rights to participate in a distribution of capital and whether the shares are redeemable.

Paid and unpaid shares, and currency

The statement must show the aggregate amount unpaid on shares in each class.

Most small UK companies denominate their shares in pounds sterling, but shares can be denominated in other currencies and the statement must identify the relevant currency.

Updating your statement of capital

You do not normally file a standalone statement of capital every time something changes.

Instead, Companies House requires a statement of capital as part of the relevant filing when specified changes are made to the company’s share capital.

For example, if the company allots new shares, it must file Form SH01 within one month of the allotment. The SH01 includes an updated statement of capital showing the position after the allotment. :contentReference[oaicite:2]{index=2}

Other changes, such as the cancellation, consolidation, subdivision, redenomination or reduction of shares, have their own Companies House forms and filing requirements.

Annual confirmation statement

The confirmation statement replaced the annual return in 2016.

Companies must file a confirmation statement at least once every 12 months, and it must be delivered to Companies House within 14 days of the end of the review period.

For a company with share capital, Companies House must hold an up-to-date statement of capital as part of the confirmation statement process.

The current filing fee is £50 for a digital confirmation statement or £110 for a paper filing.

Even if there has been no change to the company’s share capital, the company still needs to confirm that the information held by Companies House is correct.

Information about people with significant control (PSCs) is also dealt with as part of the company’s wider Companies House filing obligations, although PSC information is separate from the statement of capital itself.

Further reading on LCH

For more information, read what is share capital, and what types of share can you issue? and what are different share classes used for?