Guides
How to increase company capital in Nepal
Capital increases usually come up for a bank loan, a tender or expansion. Start by getting the terms straight.
Authorised, issued and paid-up
- Authorised capital — the ceiling on what the company may issue
- Issued capital — what has actually been issued to shareholders
- Paid-up capital — what shareholders have actually paid in
The government fee is based on authorised capital, so setting it higher than you need costs money.
The process
- Decide the increaseAuthorised only, or issued as well — the process differs.
- Pass the resolutionResolve on the increase and the memorandum amendment at a special general meeting.
- Allocate the new sharesDecide who takes them up. Anything other than proportional take-up shifts the ownership split.
- Amend the documentsAmend the memorandum and articles.
- Pay and filePay the fee and file the application.
Advice
A capital increase can have tax consequences, particularly when funded by capitalising profit. Talk to your auditor before deciding.
Please note
Government procedures, fees and deadlines change. This guide was updated on the date shown above. Confirm the current position with the relevant office or your auditor before acting on it. This is not legal advice.