Hurd takes CIO legislation to Parliament

31 Oct 2012 News

The minister for civil society has laid the secondary legislation for the charitable incorporated organisation structure before Parliament, paving the way for the first registrations in January.

The minister for civil society has laid the secondary legislation for the charitable incorporated organisation (CIO) structure before Parliament, paving the way for the first registrations in January.

The Charity Commission revealed its proposed timetable for implementation of the new corporate legal form for charities in England and Wales at the Charity Law Association conference earlier this month.

If the legislation is passed without delay in Parliament, new charities with an income over £5,000 may be able to register as CIOs as early as January 2013. This will be followed in March by existing unincorporated charities with an income more than £250,000. (Full schedule for all charities laid out below).

The path to developing CIOs has been a long one. After 15 years of development, the concept was finally introduced in the Charities Act 2006, but has still not been implemented in England and Wales. Scotland introduced the structure in 2011 and by December of that year one-fifth of all new charities registered as CIOs.

The CIO structure seeks to remove the burdensome dual registration required to benefit from incorporation. CIOs will need only to register with the Charity Commission, not Companies House, and as a CIO trustees will have limited liability, that currently only corporate charities enjoy. 

Laying the legislation before Parliament yesterday, Hurd said:  "The CIO will add to the range of legal structures that charities can choose to adopt. Implementing the CIO supports the government’s aim of making it easier to set up and run a civil society organisation.

"Due to its limited liability, the CIO structure should make it easier for charities to recruit and retain trustees, and to engage in contracts and hold property. Implementation of the CIO is supported by the Charity Commission and will be welcomed by the voluntary sector."

Current timetable for registrations:

  • From January 2013 new charities with annual income more than £5,000
  • From March 2013 existing unincorporated charities with annual income more than £250,000
  • From May 2013 existing unincorporated charities with annual income between £100,000- £250,000
  • From July 2013 existing unincorporated charities with annual income between £25,000 -£100,000
  • From October 2013 existing unincorporated charities with annual income between £5,000-£25,000
  • From January 2014 all unincorporated charities.
  • No timescale yet for existing companies limited by guarantee to convert.

 

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