Community Interest Company or CIC.

Community Interest Company – What’s That?

A community interest company, or CIC for short, is a special type of business that aims to make a positive difference in society.

community interest company - working together.

Unlike a regular company, a Community Interest Company does not exist to make profits for its owners or shareholders, but to use its income and assets for the benefit of the community.

A CIC can be involved in any kind of activity, such as providing social services, promoting arts and culture, protecting the environment, or supporting a good cause.

A CIC is regulated by the Office of the Regulator of Community Interest Companies, which ensures that it meets certain criteria and follows certain rules. Some of the main features of a CIC are:

  • It has a community interest test, which means it must demonstrate that its activities are for the public good or a specific section of the community.
  • It has an asset lock, which means it cannot sell or transfer its assets for less than their market value, or use them for purposes other than its social mission.
  • It has a dividend cap, which means it can pay dividends to its shareholders, but only up to a certain limit, and only if it has enough money to carry out its community objectives.
  • It has an annual CIC report, which means it must report on its social impact and financial performance every year.
Community Interest Company - For The Benefit Of The Community.

A CIC can be formed by anyone who wants to start a social enterprise, or by converting an existing company, charity, or industrial and provident society into a CIC. A CIC can also change its status to a different legal form, such as a charitable company or a charitable incorporated organisation, if it wishes to do so.

A CIC can benefit from various sources of finance, such as grants, loans, donations, or social investment. However, a CIC is not eligible for tax relief, unless it also registers as a charity. A CIC can be a great way to combine business skills with social values, and to make a positive impact in the world.

If you are interested in learning more about CICs, you can read the information pack or the frequently asked questions provided by the government. You can also visit the Wikipedia page or the Business Advice website for more information.

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