Reduction of capital or capital reduction is to decrease stock of a company. During reduction of capital, sometimes the company returns a portion of the stock of a company to shareholder. A private company can reduce its capital in many different ways.
New and simpler procedures for the reduction of capital were introduced in the United Kingdom by the Companies Act 2006.[1] Before these provisions came in, a court order was required to reduce share capital.[2]
See also
- Capital impairment
- Capital increase (de:Kapitalerhöhung)
- Dividend
References
- Department of Trade and Industry, Companies Act: A summary of what it means for private companies, February 2007, URN 07/712, page 12^
- Company Law Club // Reduction of capital (Without court order)^