What is the Difference Between Authorized Capital and Paid Up Capital | Startup Guide - Corpbiz

#DifferenceBetweenAuthorizedandPaidupCapital
• #Authorizedcapital is the maximum value of the shares that a company is legally authorized to issue to the #shareholders. Whereas, paid-up capital is the amount that is actually paid by the shareholders to the company.
• At any point, the #paidupcapital of a company can never be more than its authorized capital. On the other hand, a company is not authorized to issue shares beyond the #authorizedsharecapital.
• A company can increase its authorized share capital in the future by following the procedure mentioned in the #Companies Act, 2013. Whereas, a company can increase its paid-up capital by way of issue of shares or private placement.
• Authorized #capital cannot be used in the calculation of net worth of a company, while paid-up capital is considered for net worth calculation.
• Stamp Duty is paid on Authorized #Share Capital at the time of #Incorporation of the Company

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