capital sum: meaning, definition, pronunciation and examples
C1formal, legal, financial, business
Quick answer
What does “capital sum” mean?
A single, large amount of money paid or received at one time, as opposed to regular smaller payments.
Audio
Pronunciation
Definition
Meaning and Definition
A single, large amount of money paid or received at one time, as opposed to regular smaller payments.
A principal lump-sum amount of money involved in a financial transaction, insurance claim, investment, or legal settlement.
Dialectal Variation
British vs American Usage
Differences
Slightly more common in UK legal/financial contexts (e.g., pensions, trusts). US usage often favors 'lump sum' or 'principal amount' in equivalent contexts.
Connotations
UK: Strongly associated with insurance payouts, pension commutation, and trust distributions. US: Often found in legal settlements, estate planning, and bond redemption contexts.
Frequency
Medium frequency in specialist domains in both varieties; 'lump sum' is a more common everyday synonym in both.
Grammar
How to Use “capital sum” in a Sentence
[Subject] receives/pays/inherits a capital sum of [amount]The [policy/trust] provides for a capital sumto commute [pension/annuity] for a capital sumVocabulary
Collocations
Examples
Examples of “capital sum” in a Sentence
noun
British English
- The endowment policy matures, providing a tax-free capital sum.
- He opted to commute part of his pension for an immediate capital sum.
American English
- The settlement included a substantial capital sum for damages.
- The trust distributes the capital sum to the beneficiaries upon termination.
Usage
Meaning in Context
Business
Used when discussing buyouts, severance packages, or investment of a large initial amount.
Academic
Found in economics, finance, and law papers discussing intertemporal choice, pension systems, or settlement structures.
Everyday
Rare; would be used when discussing a large insurance payout or inheritance.
Technical
Precise term in insurance (sum assured), pension law (commutation), and trust administration.
Watch out
Common Mistakes When Using “capital sum”
- Using 'capital sum' to refer to the cost of capital goods (use 'capital expenditure').
- Confusing it with 'capital' in the sense of wealth or assets.
- Using it as a synonym for any large amount, missing its specific 'one-time, principal' connotation.
FAQ
Frequently Asked Questions
Yes, they are largely synonymous in financial contexts. 'Capital sum' is often more formal and can emphasize the principal nature of the amount, while 'lump sum' is more colloquial.
Typically not. It refers to a principal amount paid or received, not borrowed. The borrowed amount would be the 'principal' of the loan.
No, the tax treatment depends on the source (e.g., inheritance, pension commutation, insurance payout) and local jurisdiction. It is a descriptor of the payment type, not its tax status.
'Capital' is a broader term for wealth or money used for investment. A 'capital sum' is a specific instance of that—a defined, singular amount of money being transferred.
A single, large amount of money paid or received at one time, as opposed to regular smaller payments.
Capital sum is usually formal, legal, financial, business in register.
Capital sum: in British English it is pronounced /ˌkæp.ɪ.təl ˈsʌm/, and in American English it is pronounced /ˈkæp.ə.t̬əl ˈsʌm/. Tap the audio buttons above to hear it.
Phrases
Idioms & Phrases
- “To take the capital sum and run”
- “A capital sum to cushion the blow”
Learning
Memory Aids
Mnemonic
Think of the CAPITAL city: big and singular. A CAPITAL SUM is a big, singular amount of money.
Conceptual Metaphor
MONEY IS A FLUID (a sum can be 'paid out', 'received', 'invested') / A LARGE AMOUNT IS A SOLID OBJECT (a 'lump' sum, a 'substantial' sum).
Practice
Quiz
In which scenario is the term 'capital sum' LEAST likely to be used correctly?