Authorized Capital

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BALAKKRISHNAN (Querist)

23 September 2020 Pls. clear me what is optimum figure for authorized capital? even though it starts from 1,00,000 onwards what would be the long term impact if i put 10,00,000 in place of 1L as authorised capital (except number of shared). Whether it will impact anywhere in future like balance sheet, repayment if company goes shut, any other legal criticalities? where are all it will reflect exactly?

CS Deepa Lakhwani

CS Deepa Lakhwani (Expert)

29 September 2020
Hello Dear ,
For opting 1,00,000 rs as authorised share capital onwards what would be the long term impact ? Ans: Will impact your payment of stamp duty .
similarly if your will choose to put it as 10 lakh so stamp duty will increase at present as per stamp duty act ,and for future it will help you to increase your issued share capital in future if you would like to increase .
Because beyond authorised share capital you cant increase your desire capital more than it ,provided that alteration in MOA Clause which is little bit more formal and legal way ,so for considering your future need of issued and paid up share capital you may decide what should be your authorised capital .

Thanks and Regards
Deepa Lakhwani .

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