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Capital Reductions and Capital Contributions

 
Continuing our series on legal and other concepts aimed at those working in tax Malcolm Hurley Corporate Partner and Mark Harden Senior Lawyer Tite & Lewis discuss companies reducing their share capital
 
Over the last year or so companies have become increasingly interested in the idea of reducing their share capital. This article examines the reasons behind this interest and the mechanics associated with achieving such reductions. The corporate law status of capital contributions is also considered.
Reasons For Reducing Share Capital
 
The potential attractions of a capital reduction are numerous. However the most common reasons for advising such a reduction certainly include the following.

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