Over half of new charities are set up as Charitable Incorporated Organisations (CIOs) which work well for small to medium-sized charities. CIOs are a special type of corporate body only available to charities, but with one regulator, the Charity Commission, so returns only need to be made to the commission.

New regulations now mean that it is easier for Community Interest Companies (which are not charities) and existing charities structured as companies limited by guarantee, to convert to become a CIO.

Whilst it was possible to do a conversion before this, it was a fairly drawn-out process.  The new regulations mean that it should be more streamlined with applications made directly to the Charity Commission, rather than having to go to and fro between Companies House and the Charity Commission (as it currently stands).

Implementation will be phased, so that currently only those organisations with an income of less than £12,500 can apply, but by 1 August 2018 it will be available to all.

In practice, this will probably only be of interest to smaller charities who are struggling with the dual reporting requirements of being a company limited by guarantee.  It may, however, be of particular interest to Community Interest Companies who are finding that as they have grown and developed, they  would in fact be able to achieve more as a charity.

Other welcome news is that the names of CIOs will now be included on the business register kept by Companies House, making it harder for companies to be formed with the same or similar name.

If you are thinking about changing your existing structure to become a CIO please contact us.

If you need advice reviewing the issues raised in this article or any other issue get in touch either by telephone 01726 74433 or email enquiries@stephens-scown.co.uk