What is social capital? Learn how to define the share capital of a company

What is share capital? O share capital refers to the amount of money that partners and shareholders invest when opening a company.

This amount includes the initial costs of maintaining the activities of the new business, considering the time it takes to adapt to the market, that is, the period during which it may not generate profit.

The amount is used to cover infrastructure costs, such as accessories, equipment, means of communication, transportation, etc. Everything related to physical needs that will sustain the company.

Establishments in the commercial sector must present in their registration document the amount of share capital, in addition to how the value will be checked, whether it will be in currency or in goods right.

The analysis of social capital is carried out according to three important aspects:

• Financial: represented by the resources initially invested in maintaining the company's activities in the initial periods of its foundation;
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• Social: it is represented by the relationship rules of the investor society, that is, its partners and shareholders. The rules serve to define the objectives of the company and its organization, such as the percentage of each partner and their responsibilities;
• Limit of liability: refers to the company's obligation to repair the damage caused to the other party or to third parties when there is a breach of obligations.

Typically, this applies to partners and shareholders who have invested in the company.

How can I define the share capital of a company

The definition of a company's share capital depends on aspects, especially if the amount to be invested comes from a company.

It is important to make clear and established the following items related to the opening of the company:

• Expenses with materials and production inputs;
• Advertising investments;
• Amount referring to the payroll of employees;
• Basic services for the operation of the physical structure of the establishment;

All decisions taken by participants in the society must be set out in writing in the called social contract or shareholder agreement to avoid changes and alterations that deviate from the agreement initial.

Social Capital for the MEI

the acronym MEI means Individual Microentrepreneur and represents self-employed business owners.

The MEI appears as an official record in the government for those who work as owners of their own micro businesses, especially in the form of autonomous professionals.

When it comes to MEI's share capital, there is no initial limit or minimum amount for investments when opening a micro-enterprise. Just declare how much was spent on furniture, equipment, working capital and initial operating resources

However, what is actually taken into account are profits and revenues, whether annual or monthly. In this case, the MEI needs to report the values ​​achieved by the company within a year so that, if it is within the established limits, it remains in the category.

See too: MEI obligations: Reports, declarations and other requirements of the Law