Calls for partly paid shares explained
On the issue of partly paid shares, the company has the obligation to collect the unpaid amount. To do this, managers may request a notice to the holders of the shares that asks them to pay the amounts. Here we look at the process of using this process, but will have to confirm with articles of association, as they may give you a different route to take. We will also see the process of how to make a call on shares of company`s plc; this is because there are more topics for these businesses to consider.
The directors shall adopt a resolution to call on shares partly paid or unpaid. The needs identified for the resolution must be detailed within the meeting. The resolution, however, usually will have details of the cost of the call and the due date for the payment required.
After this, you need to send a notice to shareholders who want to make a call. This will be the people who were originally issued shares. However, if the shares have been transferred, the last owner will usually have to pay all of the calls.
When the due date comes, check all payments received against the expected. You should have received most or all of the payment due, and send reminders to those who have not paid if necessary.
A letter like this should state that:
â€¢ Payment must be made immediately
â€¢ If necessary, interest on the outstanding balance will be charged
â€¢ The shareholder may lose fees if they do not pay the call
It is good practice to post another reminder if payment is not received within a reasonable time – say a week or two.
Once payment is received, you will need to update your membership records. This is to show that the call is paid. If this is one of a series of payments, you may also want to have an updated schedule of additional payment.
You will have to modify and update the share certificates, including the following:
â€¢ Cancellation of certificates of old shares;
â€¢ Submission of updated shares certificates showing the amount paid for the shares
â€¢ Updated registration certificates of shares of the company assets
Companies House have the updates to the status of capital of the company, and this can be found in the annual declaration.
After a call to action, many companies make the decision to submit the next annual return early. This means that any data recovery from Companies House will quickly realise the position of the shared capital. This can make the end of the calling process seem more “official”, although there is no specific legal reason to do so.