What is Paid up Capital in a Private Limited Company

In a Private Limited Company, the paid-up capital is the amount of capital that the company has actually raised from shareholders. It is the portion of the authorized capital that has been issued to shareholders and for which they have paid the full subscription price.

The paid-up capital of a Private Limited Company is expressed in terms of the number of shares and their par value. It is typically lower than the authorized capital, as the company may not have issued all of the shares that it is permitted to issue.

The paid-up capital of a Private Limited Company is an important indicator of the company’s financial strength and stability. It represents the funds that are available to the company to finance its operations and invest in its business.

It’s worth noting that the paid-up capital of a Private Limited Company may be increased by issuing additional shares to shareholders or by obtaining additional capital from other sources, such as loans or investments. The company must follow the appropriate procedures and obtain the necessary approvals before increasing its paid-up capital.

Leave a Comment

Your email address will not be published. Required fields are marked *