Bonus Issue in United Kingdom

Definition of Bonus Issue

In accordance with the work A Dictionary of Law, this is a description of Bonus Issue : (bonus issue, capitalization issue)

A method of increasing a company’s issued capital (See authorized capital) by issuing further shares to existing company members. These shares are paid for out of undistributed profits of the company, the *share premium account, or the *capital redemption reserve. The bonus issue is made to shareholders in proportion to their existing shareholding (e.g. a 1 for 2 bonus issue means that shareholders receive an extra free share for every two shares they hold).

capitalization issue

(bonus issue, capitalization issue)

A method of increasing a company’s issued capital (See authorized capital) by issuing further shares to existing company members. These shares are paid for out of undistributed profits of the company, the *share premium account, or the *capital redemption reserve. The bonus issue is made to shareholders in proportion to their existing shareholding (e.g. a 1 for 2 bonus issue means that shareholders receive an extra free share for every two shares they hold).