Yes, but reducing share capital is more restricted than increasing it. Under the Companies Act, a company generally needs a special resolution and court approval before the reduction can be recorded.
Why court approval matters
Reducing capital can affect creditors and shareholders. The law therefore imposes safeguards before a reduction becomes effective.
OCR documentation
OCR guidance refers to:
- company application;
- details and reasons for the proposed change;
- certified copy of the court-approved decision;
- amendments to the Memorandum and Articles where required.
Important distinction
Cancellation of unissued shares, reduction of paid-up capital and other capital restructuring steps do not always have identical legal consequences. The exact transaction should be analyzed before filing.