Paid Up Capital

935 Views  ⚫  Asked 7 Years Ago
asked on Apr 22, 2015 at 03:39
Here I have some questions about paid up capital for Sdn Bhd:

1. As I read on the internet, I come across reducing paid-up capital. Why would people want to reduce paid-up capital?

2. Can I use the remaining authorized capital to give shares to employee? Let say I am giving a share worth RM2K to an employee, can I use that to deduct the tax?

3. If I am plan to give shares to employees, and also getting investors in near future, does that mean I need to put actual amount of paid-up capital, so that it can be calculate to actual share percentage and investor's money is 100% put into company, not partially giving to existing shareholder?

4. Can we use ratio in paid up capital to represent actual amount? For example RM10 in paid up capital = RM1K in actual amount. Then, if one day a shareholder with RM100 paid up capital decide to quit and sell of share, that shareholder will get RM10K?
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answered on Apr 22, 2015 at 05:41
There is a possiblity of terms mixed up.

1/ There can be a reduction of Share Capital and not Paid Up Capital.

2/ There are also different categories of Shareholdings for different types of industries if you know the "game".

3/ What is your company Authorised Capital?

4/ What is your company Paid Up Share Capital?
•Fully Paid Up
•Partial Paid Up

5/ What is the type of shareholdings issued?
•Ordinary shares
•Voting and/or Non-voting shares
•Redeemable shares
•Preference shares
•Deferred ordinary shares
•Management shares

If you would like to "give" shares to your employees, then alot of work has to be done. If you do not understand the terms of shareholdings above, it would be prudent to consult your
1/ Accountant
2/ Auditor
3/ CoSec
4/ Tax Accountant

If they cannot offer you satisfactory explanations... Find new ones..
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