The terms "allotting shares" and "issuing shares" are often used interchangeably. In some cases, particularly when shares are created by a public company, there may be a difference. Share allotment, strictly, is the allocation of the right to certain shares to particular applicants for them. Such "allottees" may be sent allotment letters (which may be renounceable in favour of others), and the actual issue of the shares occurs later. In most private companies allotment and issue will be the same process. A company may allot shares when it is first set up or at any time during its lifetime in order to raise share capital and/or introduce new shareholders.

Issuing shares is a more complex procedure than many would expect. There is far more to it than just filling in a form and sending it to Companies House.

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