To increase authorised capital, confirm the articles permit it, pass a board resolution and an ordinary resolution of shareholders (unless the articles require more), alter the MoA capital clause, and file SH-7 with the ROC within 30 days, paying the fee and stamp duty on the increase. New shares can then be allotted, reported in PAS-3.
Authorised vs paid-up capital
Authorised capital is the maximum a company can issue; paid-up capital is what shareholders have actually paid for issued shares.
Process
- Check AoA authorisation.
- Board meeting and notice of general meeting.
- Shareholders' resolution.
- File SH-7 with altered MoA.
- Allot shares and file PAS-3.
Costs
ROC fees and stamp duty depend on the amount of increase and state.
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Get expert help →Planning for funding
Increase authorised capital before a funding round so allotments are not delayed.
Frequently asked questions
Is a special resolution needed?
Section 61 requires an ordinary resolution unless the articles require a special resolution.
Can capital be increased without new shareholders?
Yes. Authorised capital can be increased first; allotment to existing or new shareholders follows separately.
What is PAS-3?
PAS-3 is the return of allotment filed within 15 days of allotting shares.
Can authorised capital be reduced?
Unissued authorised capital can be cancelled; reducing paid-up capital requires a separate procedure.
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