Converting to a Charitable Incorporated Organisation

Posted On November 2, 2017 By mhauk

From January 2018, incorporated charities will be able to become a charitable incorporated organisation (CIO), as long as an order laid before Parliament is approved.

The CIO is a fairly new type of charitable structure that was introduced in the Charities Act; it allows charities to take advantage of many of the benefits of incorporation, without being registered with Companies House, and therefore having to bear the administrative burdens that come with this. As a CIO is a separate legal entity to its trustees, the trustees are not liable for its debts on wind-up (assuming they have not engaged in fraudulent or wrongful trading), and this as a result, has be an attractive structure for existing charities or prospective charities.

An impact assessment conducted by the Charity Commission has estimated that the equivalent annual de-regulatory benefit is £3.6m and that up to 12,000 small charities will benefit from these changes over ten years.

If you would like further guidance on this process or if you would like assistance in setting up a CIO, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our Not for Profit team.

This article originally appeared on the blog of our member firm, MHA MacIntyre Hudson.