The main advantage of CIOs over charitable companies is that CIOs don’t have to register with and send accounts to Companies House as well as the Charity Commission.
Changing to a different charitable structure usually involves setting up a new charity, transferring your original charity’s assets and liabilities to it then closing your original charity.
The conversion process should be simple and straightforward in most cases. As part of this process, the new CIO Constitution and Special Resolution will need to be included before submission to the Commission.
Using this process means that the charity continues to exist but in a different form. This means you’ll be able to keep the charity’s existing name and charity number.
You should also be able to keep the charity’s existing bank accounts and in most cases the new CIO should receive any legacies left to the original charitable company.
The Commission will liaise with Companies House to ensure that necessary records are updated correctly. This will mean that the date of conversion of the charitable company to a CIO – as shown on the public register of charities – will match the date of removal of the charitable company at Companies House.
Please note that due to limited resources, your application may be rejected if:
- complete documentation is not sent or received
- your charity is not in compliance with its reporting requirements to the Charity Commission and Companies House
- your charity has made any changes to the new CIO governing document that would require the Charity Commission’s approval including:
- name change, except a minor change such as removing limited or company and replacing it with CIO and also if the name is not one that is regulated on the business register and no approval has been submitted with the application
- any additional trustee benefits especially if there is an express prohibition in the company’s governing document
- amendments to the dissolution clause that will change the spirit of the intention of who receives the funds on dissolution