non-distributable reserves

non-distributable reserves
In order to protect their creditors, companies are generally prohibited from distributing share capital and non-distributable reserves to shareholders. Non-distributable reserves include the share premium account and capital redemption reserve, both of which can only be used for a limited number of purposes (sections 130 and 170, Companies Act 1985).

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

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