What is Authorised Share Capital?
Authorised share capital used to refer to the maximum amount of share capital that a company was permitted to issue, as stated in its memorandum of association. This set an upper limit—companies could not issue shares beyond this amount unless they formally increased the authorised share capital.

Current Position:

• Abolished: Since 1 October 2009, authorised share capital is no longer part of company law.
• UK companies no longer specify an authorised share capital when forming a company or filing documents.
• Instead, companies can issue shares as needed, subject only to the provisions in their articles of association and shareholder approval.

What Does This Mean for You?

• You do not need to set an authorised share capital at formation or in subsequent filings with Companies House.
• If your company’s articles still refer to authorised share capital, those references are now redundant and can be removed by adopting amended articles.

Implications:

• Share allotments are not restricted by an “authorised” maximum.
• The concept now only persists if specified in a company’s articles as an internal restriction, but it has no legal effect for Companies House.