CAC Share Capital Increase Approval Guide: A Practical Guide for Nigerian Businesses 2026

On BusinessPortal, we understand that growing your business in Nigeria often means needing more money. One big way companies get more money, especially from investors, or even just to show they are serious, is by increasing their share capital. It sounds like a big grammar term, but it’s really about changing the official amount of money your company is registered to have. This guide will walk you through everything, step-by-step, so you can understand and get your CAC share capital increase approval without too much headache.

Key Takeaways

• Increasing share capital means boosting your company’s official registered capital amount with the Corporate Affairs Commission (CAC).
• This process usually needs resolutions from your company’s board and shareholders.
• You will need to pay stamp duty and CAC filing fees, which depend on how much you are increasing the capital by.
• All filings are now done online through the CAC portal, so you need all your documents ready in soft copy.
• Getting help from a company secretary or lawyer can make the process smoother and faster.

Introduction to Share Capital and Its Importance

So, let’s talk about share capital. What exactly is it? In simple terms, your company’s share capital is the amount of money or value that your company is registered to have, represented by shares. When your company was first registered with the Corporate Affairs Commission (CAC), you declared a certain amount as your initial share capital. This is the foundation of your company’s financial structure, you know?

Now, why would any business want to increase their share capital? From what I’ve seen, there are many good reasons why companies decide to do this. For instance, if your business is growing and you want to bring in new investors, those investors will usually want to buy shares. When they buy shares, they put money into your company, and to make it official and legal, your registered share capital needs to go up to reflect that new investment. It’s just normal business practice.

Another common reason is for expansion. Maybe you want to open new branches, buy more equipment, or even get bigger contracts. Many banks and even some big clients look at your company’s registered share capital as a sign of its capacity and financial strength. A higher share capital often gives your company more credibility, making it easier to get loans or secure bigger deals.

Related Post Incorporation: How to Change Company Address on CAC: A Full Step-by-Step Guide for Nigerian Businesses in 2026

Also, sometimes it’s about compliance. The law might require companies in certain industries to have a minimum share capital. For example, if you want to apply for some licenses or operate in a regulated sector, you might discover that your current share capital is too low. Increasing it becomes a must to meet those regulatory requirements. It’s really about making sure your business can do all the big things you plan for it.

Understanding CAC Requirements for Share Capital Increase

Before you even start the process, it’s very important to know what the Corporate Affairs Commission (CAC) expects from you. The main law guiding all these things in Nigeria is the Companies and Allied Matters Act (CAMA), 2026. This law sets out all the rules for how companies should operate, including how they can change their share capital.

Under CAMA, your company has to follow certain steps when you want to increase your share capital. It’s not just about deciding in your head that you want to increase it; you need to make it official. The law says that for most increases, your shareholders must agree to it. They do this by passing what we call a resolution. We’ll talk more about that one later.

Related Post Incorporation: CAC Company Name Change Timeline: Your Detailed Guide to Updating Your Business Name in 2026

One key thing to remember is the minimum share capital requirement. For a private company in Nigeria, the minimum share capital is usually N100,000, and for a public company, it’s N2,000,000. But these are just the minimums. Depending on what your business does, your industry regulator might demand a much higher minimum. So, it’s always good to check if your specific business sector has its own special rules on capital. You need to make sure your new, increased capital still meets any such specific industry requirements, not just the general CAC minimum.

When I guide clients through this, I always tell them to look at their Articles of Association. This document, which you registered with CAC when you first started your company, usually contains rules about how you can change your share capital. Sometimes, it might have specific clauses you need to follow, or even say you need a special kind of resolution. It’s always good to cross-check these things before you start.

The Step-by-Step Process for Share Capital Increase

Okay, now let’s get into the real work. The process for increasing your share capital with CAC has clear steps. From what I’ve seen, if you follow these steps properly, the whole thing can be quite smooth.

Related Post Incorporation: CAC Share Capital Increase for Travel Agencies: A Detailed Guide to Compliance and Growth in 2026

Preparation Phase

1. Board Resolution: The very first step is for your company’s directors to meet. They need to agree, officially, that they want to increase the share capital. This agreement is written down as a Board Resolution. This resolution will state how much the capital will be increased by, the reasons for it, and that they recommend it to the shareholders. It’s like the directors giving their blessings first.

2. Shareholders’ Ordinary Resolution: After the directors agree, the shareholders must also agree. This usually happens at an Extraordinary General Meeting (EGM) or an Annual General Meeting (AGM). For most share capital increases, you will need an Ordinary Resolution. This means more than half (a simple majority) of the shareholders who are present and voting must agree. The resolution will clearly state the amount of the new share capital and how the new shares will be issued (e.g., to existing shareholders, new investors, etc.).

3. Special Resolutions (if applicable): Sometimes, if your company’s Articles of Association say so, or if you’re doing something unusual with the shares, you might need a Special Resolution. This one is tougher to get because it requires at least 75% of the shareholders present and voting to agree. It’s not common for just increasing capital, but it’s good to know it exists, just in case.

4. Valuation Report (for Non-Cash Consideration): What if you are increasing share capital not by bringing in cash, but by turning an asset (like land, equipment, or even intellectual property) into shares? This is called non-cash consideration. In this case, CAC will usually ask for a valuation report from a professional valuer. This report will confirm the true value of the asset you are using, so that it matches the value of the shares being issued. It’s to make sure everything is fair and square.

CAC Filing Phase

Once all your internal company approvals are done, the next big part is to file everything with the CAC online. This is how it goes now, everything is digital on the CAC portal.

1. Login to the CAC Online Portal: You or your company secretary will log into the CAC online registration portal. This is where all company filings happen these days.

2. Initiate the Process: On the portal, you will select the option for “Post-Incorporation Filings” and then look for “Increase in Share Capital.”

3. Fill Required Forms: You will need to fill out certain electronic forms. The main one usually is an updated Statement of Share Capital and Return of Allotment (often called CAC 2.5, though the numbering can change with portal updates). This form will clearly show your old share capital, the new share capital, and how the new shares are allotted. You will also need to input details of the new shareholders if there are any, or how the existing shareholders’ holdings have changed.

4. Calculate and Pay Stamp Duty: This is a very important part. Before you can even submit to CAC, you need to pay stamp duty. The stamp duty is calculated based on the *amount of the increase* in your share capital. The Federal Inland Revenue Service (FIRS) collects this. You will generate a Remita Retrieval Reference (RRR) code from the CAC portal, pay at a bank or online, and then input the payment details back into the portal. The stamp duty rate is generally 0.75% of the amount of the increase. *For example, if you increase by N10 million, stamp duty will be N75,000.*

5. Calculate and Pay CAC Filing Fees: After stamp duty, you also pay the CAC filing fees. These fees are also calculated based on the amount of the increase, but at a different rate, usually around 0.35% for private companies. Again, you will generate an RRR code, pay, and input the payment details. *So, for that same N10 million increase, CAC fee might be N35,000.* These fees can change, so always check the current rates on the CAC portal.

6. Upload Documents: You will need to upload scanned copies of your Board Resolution, Shareholders’ Ordinary Resolution, and if applicable, the Valuation Report. Make sure these documents are clear and properly signed. In my experience, blurry documents are a common reason for queries from CAC.

7. Submit Application: Once all forms are filled, fees paid, and documents uploaded, you will submit your application. You will get an application number, which you can use to track the progress.

Post-Filing Phase

After you’ve submitted everything online, it’s a waiting game, but not for too long if everything is correct.

1. CAC Review: The CAC officials will review your application and the uploaded documents. They check to make sure everything is in order, that the resolutions are properly worded, and that all fees have been paid correctly.

2. Query Resolution: Sometimes, CAC might have questions or notice a small error. They will send a “query” to your online portal. You will need to address the query, make the necessary corrections, and resubmit. This is why having accurate documents from the start is important; it saves time.

3. Issuance of New Certificate of Capital: Once everything is approved, CAC will issue a new Certificate of Capital (sometimes called a Certificate of Allotment or an updated Statement of Capital). This new certificate will clearly show your company’s increased share capital. This is the official proof that your share capital has been successfully increased. You can usually download this from your portal.

   Read Also: How to Add a Director on CAC: Detailed Steps and Requirements for Your Nigerian Business in 2026

   Frequently Asked Question

   Can I file Annual Returns if my business is not active or made no money?
   Yes, even if your business is dormant (not active) or made no profit, you must still file annual returns. You’ll file it as a ‘dormant company’ or ‘zero income’.

Essential Documents for CAC Share Capital Increase

To make sure your application goes through without issues, you need to have all your documents ready. From what I’ve seen, gathering these beforehand saves a lot of back-and-forth.

• Copy of the Board Resolution approving the increase in share capital.
• Copy of the Shareholders’ Ordinary Resolution (or Special Resolution, if applicable) approving the increase.
• Duly completed and signed Statement of Share Capital and Return of Allotment (the electronic form on the CAC portal).
• Evidence of Stamp Duty payment (FIRS assessment and receipt).
• Evidence of CAC filing fees payment.
• A certified valuation report (if share capital is increased through non-cash assets).
• Your company’s Certificate of Incorporation (sometimes needed for reference, but not always uploaded).
• Your company’s Memorandum and Articles of Association (MEMART) (for reference, to ensure you are following your own company rules).
• For new shareholders, their valid means of identification (e.g., passport, NIN, driver’s license) and signature specimen might be needed, especially if they are also directors.

Key Considerations and Potential Challenges

While the process sounds straightforward, there are a few things to keep in mind that can either make it easier or cause some delays. This is where my experience comes in handy, pointing out common pitfalls.

• Stamp Duty Implications: As I mentioned earlier, stamp duty is a significant cost. It’s 0.75% of the *increase amount*. So, if you plan a very large increase, you must budget for this. Many companies don’t always factor this in and get surprised by the cost.

• Timelines: How long does it take? If all your documents are correct and there are no queries, the whole process, from submission to approval, can take anywhere from 5 to 10 working days. However, if there are queries or issues with payments or documents, it can drag on for weeks. It’s always best to be patient and follow up, but don’t rush the preparation phase.

• Common Errors to Avoid: I’ve seen many applications get queried for simple mistakes. These include:

  • Incorrect calculation of fees (CAC fees or stamp duty).
  • Resolutions not properly signed or dated.
  • Names or addresses not matching exactly what CAC has on file.
  • Blurry or unclear uploaded documents.
  • Not properly specifying how the new shares are allotted.

  These small errors can waste a lot of your time and effort.

• Importance of Professional Advice: Honestly, while you can do it yourself, getting a professional involved, like a company secretary or a lawyer, is often worth it. They know the ins and outs, they understand the latest requirements from CAC, and they can help you avoid common mistakes. This means your application is more likely to go through smoothly and quickly. They are like a guide for this journey.

• Post-Approval Actions: After getting the new certificate, don’t just relax. You need to update your company’s internal records, like your Register of Members and Register of Directors. This makes sure your internal documents reflect the new share capital structure. It’s all part of good corporate governance.

Fees and Charges Involved

To help you plan your budget, here’s a simple breakdown of the typical fees you’ll encounter when increasing your share capital. Remember, these are usually percentages of the *amount of the increase*, not your total capital.

As you can see from the table, the bulk of the cost comes from the stamp duty and CAC filing fees, which are direct percentages of your increase. Always confirm the current rates on the official CAC portal before you make any payments, because these things can change from time to time.

The Role of Professionals in the Process

When you are dealing with official government bodies like the CAC, and especially with legal processes like increasing share capital, having the right professional by your side can make a very big difference. From my experience, trying to navigate these things alone often leads to avoidable errors and delays.

• Company Secretaries: In Nigeria, if your company’s share capital is above a certain threshold (or if you are a public company), the law actually says you *must* have a company secretary. Even if your company is smaller, a good company secretary is invaluable. They are experts in company law and CAC procedures. They will help you prepare the correct resolutions, ensure all forms are filled properly, calculate the right fees, and submit everything on time. They basically handle all the legal and administrative heavy lifting.

• Lawyers: A corporate lawyer can also be very helpful, especially if your capital increase is complex, involves new investors with detailed agreements, or if you are dealing with non-cash assets that need careful legal structuring. They can draft shareholder agreements, advise on the legal implications of the capital increase, and ensure everything complies with CAMA 2026 and other relevant laws.

• Accountants: While not directly involved in the CAC filing, your accountant plays a crucial role in ensuring the financial records of your company accurately reflect the new share capital. They will help properly account for the funds received (if it’s cash) or the assets injected, and update your company’s balance sheet. This is very important for financial reporting and future audits.

Working with these professionals doesn’t just save you time; it gives you peace of mind that the process is being handled correctly and legally. It’s an investment that prevents future problems, which can be much more expensive to fix.

For official information and to verify current requirements and fees, you can always check the Corporate Affairs Commission (CAC) website directly. Also, for detailed legal references, you can refer to the Companies and Allied Matters Act (CAMA) on reliable legal platforms or Wikipedia.

Frequently Asked Questions (FAQs)

What is share capital?

Share capital is the amount of money or value a company is officially registered to have, divided into shares. It’s like the initial investment and the total maximum investment a company is authorized to receive from its shareholders.

Why would my company need to increase its share capital?

Companies increase their share capital for several reasons: to raise more funds from investors, to expand their business operations, to meet regulatory requirements for certain licenses, or to enhance their credibility and financial standing with banks and clients.

Is there a minimum share capital requirement in Nigeria?

Yes, for private companies, the minimum share capital is usually N100,000. For public companies, it’s N2,000,000. However, specific industries might have higher minimum requirements. Always check with your industry regulator.

What is the difference between an Ordinary Resolution and a Special Resolution?

An Ordinary Resolution requires a simple majority (more than 50%) of shareholders present and voting to agree. A Special Resolution requires at least 75% of shareholders present and voting to agree. Most share capital increases only need an Ordinary Resolution.

How is stamp duty calculated for a share capital increase?

Stamp duty is calculated at 0.75% of the *amount by which the share capital is increased*, not the total new capital. For example, if you increase by N5 million, the stamp duty would be N37,500 (0.75% of N5,000,000).

Can I increase share capital with assets instead of cash?

Yes, you can. This is called increasing capital with “non-cash consideration.” If you do this, the CAC will usually require a professional valuation report to confirm the value of the assets you are contributing.

How long does the CAC approval process usually take?

If all your documents are complete and correct, and there are no queries, the process can take about 5 to 10 working days from submission. However, queries or errors can extend this timeline significantly.

Do I need a lawyer or company secretary to help with this process?

While not strictly mandatory for all private companies, it is highly recommended. A company secretary or lawyer can ensure all documents are correctly prepared, fees are accurately calculated, and the process is followed smoothly, avoiding common errors and delays.

What documents do I need to prepare for the CAC filing?

You will need your Board Resolution, Shareholders’ Resolution, a completed Statement of Share Capital and Return of Allotment form, evidence of stamp duty and CAC filing fee payments, and a valuation report if using non-cash assets.

What happens after the CAC approves my share capital increase?

After approval, the CAC will issue a new Certificate of Capital or an updated Statement of Capital. You will also need to update your company’s internal records, such as the Register of Members and Register of Directors, to reflect the new shareholding structure.

Written by Chioma Nwosu

Chioma Nwosu is a certified industry expert with years of hands-on experience helping businesses scale, optimize, and succeed. Our content is rigorously researched and fact-checked to ensure the highest standards of accuracy and trustworthiness.