Redenomination of Shares
Section 542 of the Companies Act 2006 allows shares in a limited company to be denominated in any currency, and different classes of shares may be denominated in different currencies. Under section 622, shares may be redenominated from one currency into another by ordinary resolution, unless the company’s articles restrict this power.
This section brings together a guidance note and supporting templates for private limited companies that wish to redenominate their share capital, with optional follow-on templates to reduce share capital to deal with rounding of the new nominal values.
The templates in this section are suitable for private limited companies and are drafted to comply with the Companies Act 2006.
We have not considered any potential tax or accounting implications. Independent legal, tax and accounting advice should be considered before carrying out any share redenomination or related capital reduction.
When to Use These Templates
Best for:
- Private limited companies converting their share capital from one currency to another.
- Companies that need to align their share capital currency with their functional or reporting currency.
- Situations where, after redenomination, the company wishes to reduce its share capital to round nominal values to more practical figures.
What This Section Covers
This collection includes templates to help you:
- Understand the legal framework and process for redenomination:
- Guidance Note – Share Redenomination, explaining the statutory provisions, the role of the articles, and the approvals and filings required.
- Approve the redenomination of shares under section 622:
- Board Minutes to Redenominate Shares (s.622), recording the directors’ decision to proceed and to put the redenomination to shareholders where needed.
- Written Resolution – Redenomination of Share Capital (s.622), for use where the redenomination is approved by written resolution.
- General Meeting Minutes – Redenomination of Share Capital (s.622), for use where the redenomination is approved at a general meeting.
- Notify Companies House of the redenomination:
- Letter to Companies House – Redenomination of Share Capital, as a covering letter for the filing.
- CHF – SH14 Notice of Redenomination, to notify Companies House of the redenomination.
- Deal with a post-redenomination reduction of capital to round nominal values:
- Board Minutes to Reduce Share Capital following a Redenomination of Shares (s.626), recording the directors’ decision to propose a reduction of capital under section 626.
- Written Resolution – Reduction of Share Capital (s.626) and General Meeting Minutes – Reduction of Share Capital (s.626), for shareholder approval of the reduction.
- Directors’ Confirmation following Reduction of Share Capital (s.627(6)), confirming that the requirements of the Companies Act 2006 for the reduction have been satisfied.
- Letter to Companies House – Reduction of Share Capital (s.626), as a covering letter.
- CHF – SH15 Notice of Reduction of Capital following Redenomination, to notify Companies House of the reduction of capital.
- Guidance Note – Share Redenomination
- Board Minutes to Redenominate Shares (s.622)
- Written Resolution – Redenomination of Share Capital (s.622)
- General Meeting Minutes – Redenomination of Share Capital (s.622)
- Letter to Companies House – Redenomination of Share Capital
- CHF – SH14 Notice of Redenomination
- Board Minutes to Reduce Share Capital following a Redenomination of Shares (s.626)
- Written Resolution – Reduction of Share Capital (s.626)
- General Meeting Minutes – Reduction of Share Capital (s.626)
- Directors’ Confirmation following Reduction of Share Capital (s.627(6))
- Letter to Companies House – Reduction of Share Capital (s.626)
- CHF – SH15 Notice of Reduction of Capital following Redenomination
Redenomination of Shares is part of Corporate. Just £38.50 + VAT provides unlimited downloads from Corporate for 1 year.
Frequently Asked Questions
Can we change our shares from pounds into another currency?
Yes. Section 622 of the Companies Act 2006 lets a limited company redenominate its share capital, or any class of it, into another currency by ordinary resolution, unless the articles prohibit or restrict it, so check them first. The conversion must use an appropriate spot rate specified in the resolution, taken from a day or averaging period within the 28 days before the resolution is passed. Start with the Guidance Note: Share Redenomination and the section 622 board minutes and resolutions.
Does redenominating change shareholders' rights?
No. Redenomination does not affect members' rights or obligations under the constitution, including dividend entitlements (even in a particular currency), voting rights or liability for unpaid amounts on shares. It changes the currency and nominal value labels, not the substance. References to the old nominal value in documents are generally read as references to the new one. That is why only an ordinary resolution is required and no class consent is normally triggered by the redenomination itself.
What do we file at Companies House after a redenomination?
Form SH14 (notice of redenomination), which includes a statement of capital, together with a copy of the resolution, within one month of the redenomination taking effect. Note the resolution itself lapses if the redenomination has not taken effect within 28 days of being passed, so complete and file promptly. This section includes the Letter to Companies House - Redenomination of Share Capital as the covering letter and the CHF SH14 form.
Why might we need a capital reduction after redenominating?
To round the new nominal values. Converting at a spot rate usually produces awkward figures (for example 0.8763 units), so section 626 allows a follow on reduction of capital to adjust them, by special resolution passed within three months of the redenomination resolution. The reduction cannot exceed 10% of the allotted share capital immediately after the reduction, and the amount goes to a redenomination reserve. File form SH15 and the resolution within 15 days, with the directors' statement confirming the 10% limit.
Do we need tax or accounting advice before redenominating?
Yes, take it before starting. The Simply-Docs templates cover the legal process of redenomination and any follow on reduction only; they do not address the tax or accounting implications, and the page is explicit that independent legal, tax and accounting advice should be considered before carrying out a redenomination or related capital reduction. Currency conversion of capital and movements to the redenomination reserve both have accounting consequences your accountant should confirm first.