Share Capital

Countries use the cash level of entry as a political instrument according to whether they want to encourage enterprise or minimize unproductive paperwork. For example, in the United Kingdom you can set up a firm with an initial share capital of just £1 ($1.5). In Switzerland you must put up SFr 20,000 ($15,000) for a GmbH limited company, while in Austria you need €40,000 ($42,000) for a GesmbH, their equivalent.

Most countries charge a stamp duty (% tax) when shares are created.

Companies are allowed to issue shares up to their formal limits by the act of incorporation. Shares allow you to parcel out the firm among financial backers and key personnel. Significantly, they can be used to raise capital by giving the public or investors a share in the firm in return for money.

Shares can be classified. You can offer holders the rights to a vote and/or share in dividends.

Directors do not technically have to be shareholders although they normally are.

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