Public limited company (PLC) must cancel shares that have been forfeited, surrendered or acquired in various circumstances described in Section 662 of the Companies Act 2006. Generally, this is done within three years. In some cases, it is done within one year.
Generally, your PLC can reduce its capital by the nominal value of the cancelled shares unless the shares or your PLC’s interest in them is disposed of in some other way.
On the other hand, your directors may reduce your PLC’s capital without a special resolution approved by the court. In this case, your directors must deliver the form SH07 with the statement of capital within one month of your PLC cancel shares to Companies House.
Share capital below authorised minimum for a PLC
For one thing, If the reduction in capital results in the nominal value of your PLC’s allotted share capital falling below the authorized minimum required of a PLC. Thereafter, your PLC must re-register as a private limited company.
The time limit for re-registration is the same as that for cancellation of the shares.