Paid-in capital is an owner's equity account. The excess received by an enterprise from investors over its share of registered capital or equity is treated as capital premium or equity premium and is included in the "capital reserve" account.
Paid-in capital refers to the capital actually invested by corporate investors in the company in accordance with the company's articles of association or contract. Except for a joint-stock company that should set up a "share capital" account for the capital invested by shareholders, other enterprises all set up a paid-in capital account.
Extended information:
Confirmation of paid-in capital:
An enterprise shall, in accordance with its articles of association, contract, agreement or relevant regulations, make actual receipts based on the actual paid-in capital. The monetary, physical and intangible assets obtained are used to confirm the invested capital. The establishment of a company must be subject to capital verification by a Chinese certified public accountant.
1. For monetary investments, confirmation and verification are mainly based on receipt receipts. For foreign exchange investments made by foreign investors, certificates from the foreign exchange administration authorities of the place where the profits originate should be obtained.
2. For investments based on physical assets such as buildings, machinery and equipment, materials and supplies, confirmation should be based on various relevant vouchers, and physical inventory and on-site surveys should be conducted to verify the relevant investments. . Houses and buildings should have property rights certificates.
3. For capital contributions based on intangible assets such as patent rights, proprietary technologies, trademark rights, land use rights, etc., all relevant vouchers and documents should be used as the basis for confirmation and verification. The industrial property rights and proprietary technology invested by foreign partners must meet the prescribed conditions
Reference: Baidu Encyclopedia - Paid-in Capital