Partly paid up share capital exists where the monies have been received by the company for equity that it has issued, but the amount received, is less than the agreed value of the shares issued.
An example of this situation is where the company might have issued 100 shares of £1 each. The holders of these have paid only 75 pence for each one to the company. In this case the shares are partly paid and another 25 pence is due for each £1 unit which has been issued.
Partly Paid Up Shares
The practice of a company having partly paid-up shares was evident during the sale of nationalised industries in the 1990's. In order to reduce the financial burden on the public, the UK government allowed shares to be paid for in instalments. People wishing to buy a stake could pay for them in two or three segments. The equity a member of the public was allocated was therefore partly paid-up until the final instalment was dispatched and received.
The owners of partly paid-up shares are liable for the unpaid amount should the company go in to liquidation.
