New legislation to help charitable companies convert to CIOs

28.11.17

Charitable companies and community interest groups will soon be able to convert to the charitable incorporated organisations (CIO) structure.

What does this mean?

CIOs are a relatively new legal form, which were introduced by the Charities Act 2011. They have become a popular legal form for new charities with over half of new charities opting to be a CIO. The CIO legal structure offers the protections of incorporated status without having to register and file with Companies House as well as the Charity Commission. The new legislation also means that all CIOs will be listed on the Business names index, held by Companies House to help protect CIO names’ from being imitated.

New organisations have been able to register as CIOs since 2013 and unincorporated charities have been able to convert since 2014. But up until now incorporated charities have not been able to become CIOs.

When does it start?

The Charity Commission has published guidance for charities wishing to convert and a timetable of when they will be able to do so.

Charitable companies with incomes under £12,500 will be able to begin the conversion process from January 2018, with all charitable companies expected to be able to convert by August. The full timetable and guidance can be found via GOV.UK.

The process for converting community interest companies will then begin in September 2018.

If your organisation needs support with legal structures, take a look at our training offer.