James Maloney considers the pros & cons of charitable incorporated organisations
The charitable incorporated organisation (or CIO), a new legal structure for charities, has proved popular since it first became available in January 2013. More than 2,300 CIOs have now been registered by the Charity Commission, accounting for over 27% of new charity registrations in the period for which they have been available. How, then, do CIOs compare to other legal structures?
Advantages of using a CIO
The CIO offers an alternative to traditional legal structures for charities. These established structures were originally designed for non-charitable purposes, although all have been adapted for use by charities. They can be divided between those (such as the company limited by guarantee (CLG)) that are incorporated and those (such as the trust or unincorporated association) that are not.
When compared with a charitable trust or unincorporated association
The CIO structure offers two key advantages:
- First, the protection of limited liability status: trustees (and members) are generally protected from financial liabilities the CIO incurs.
- Second, the benefit of separate legal
-sophie-hughes-(r).tmb-mov69x69.jpg?sfvrsn=7a9dca4b_1)
