If you run a limited company in the UK, you’re required to notify Companies House every time you cancel shares. This is done by completing an SH06 form, otherwise known as a notice of cancellation of shares.
In this article we’ll explain how to complete an SH06 form manually and file it with Companies House. We’ll also show you how much simpler the process is on Carta.
Note that this article does not provide legal, financial, accounting or tax advice, and Carta encourages you to consult a qualified professional advisor before making any decision or taking any action that may affect your business or interests. Carta is not affiliated with or endorsed by HMRC, and questions regarding use of the HMRC online portal should be directed to your professional advisors and/or HMRC.
Company and share details
Start by downloading an SH06 template from the UK Government website. Enter your company name and number, and the date on which the shares were cancelled. Note that shares cancelled on different dates must be declared in separate forms.
You’ll need to provide more detail about the class and number of shares cancelled, as well as the nominal value of each share. Different share classes need to be entered on separate rows.
Statement of capital
The fourth section of the form contains the statement of capital. This is used to inform Companies House about the capital structure of your business immediately after the cancellation of shares.
You need to fill in the class and number of shares currently issued, as well as their aggregate nominal value (i.e. the number of shares multiplied by the nominal value of each share). You should also include the total amount unpaid, if relevant.
If you’ve issued shares in multiple currencies, complete a separate table for each currency. Don’t forget to calculate the totals for each table and then for the entire page(s).
Prescribed particulars of rights
The next section relates to the prescribed particulars of rights attached to the shares listed in your statement of capital. This is essentially a summary of a shareholder’s rights, including voting rights, the right to participate in a distribution and the right to redeem shares.
Keep in mind that you need to fill out a separate table of rights for each share class, as shown below.
Sign and file your SH06 form
The following people are permitted to sign an SH06 on behalf of your business: company officers – as listed on the form – or the person authorised under either section 270 or 274 of the Companies Act 2006.
The final step is to send the form by post to the appropriate Companies House address. Alternatively, you can use the Companies House WebFiling service if you completed and signed the form digitally.
You have the option to provide contact information so Companies House can get in touch with you regarding your SH06.
How to generate an SH06 on Carta
Preparing a notice of cancellation of shares on Carta is a straightforward process which leverages your account data to minimise manual work. In only a few clicks, you can generate an SH06 form containing all the required information.
First, log into your Carta admin account. Navigate to the ‘Companies House’ section under ‘Filings’ in the left-hand sidebar. Click ‘Generate Filing’ and select ‘SH06’ from the drop-down menu.
A pop-up window will appear, explaining how to export and file your SH06. Enter the date of cancellation and choose whether or not to include draft transactions.
After clicking ‘Request report’, you’ll receive an email from Carta with a link to download the PDF. The report will also appear in your account under ‘Companies House filings’ for future reference.
All you have to do now is review, sign and file your SH06 form. You can either post a printed copy to Companies House or file it electronically. Specific instructions for filing are provided in the PDF and within the Companies House WebFiling service.