Charity Commission Announces Start Date For Charitable Incorporated Organisation (CIO) Applications

At long last, with the much anticipated and newly-passed Regulations to take effect in early January, the Charity Commission has confirmed that it will start accepting applications for CIO status from next Monday 10 December.

Who can be a CIO and why would they want to be?

CIO status allows a charitable organisation to be regulated only by the Charity Commission and not double regulated by Companies House on account of having limited liability status. The “Incorporated” part of the name is about the CIO having the same sort of legal personality as a company limited by guarantee (or CLG) which has been the most common incorporated format for charities for a long time. A CIO contracts in its own name and can allow for limited (or potentially even no) liability for trustees.

The consultation process leading up to the regulations governing CIOs included lots of lobbying from the charity sector to make CIOs simpler and easier to run than a CLG. The first draft of the model rules for a CIO looked a lot like the Companies Act 2006 Model Articles for a CLG and were criticised on that basis.

New charities considering what format to adopt and existing GLG and unincorporated charities might all consider setting up or switching to CIO status.  The model may not suit all charities and anyone considering CIO status should take specialist advice on what they plan to do and how that might work within a CIO structure.

The current timetable published by the charity commission is set out below so some charities will have longer to think about it than others.

Applications for brand new charities with incomes of over £5,000 will be able to apply for registration from 10 December 2012. The subsequent stages are set out below:

  • From late March 2013 – window opens for existing unincorporated charities (to set up a CIO and transfer assets into it) with incomes of over £250,000
  • From May 2013 – window opens for existing unincorporated charities with incomes between £100,000 and £250,000
  • From July 2013 – window opens for existing unincorporated charities with incomes between £25,000 and £100,000
  • From October 2013 – window opens for existing unincorporated charities with incomes between £5,000 and £25,000
  • From January 2014 – window opens for existing unincorporated charities with incomes less than £5,000 and for brand new charities with anticipated annual incomes of less than £5,000
Daniel Milnes

About Daniel Milnes

Dan is a Partner and Head of Contracts & Projects. Dan’s blogs cover the areas in which his specialities lie in commercial, regulatory and governance law which cover a broad range of matters dealing with contracts, projects, corporate and group structures, funding and compliance with a range of legal regimes including data protection. This also involves writing and advising on various forms of commercial contracts including joint ventures, development and construction agreements and intellectual property contracts including IT agreements, sponsorships and other rights licensing arrangements.
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