[LUG]Re: Lug funds

[Julian Hall <linux@xxxxxxxxxxxx>]

On 13/10/2025 07:15, Helen McCall wrote:

> Hello Henry,
>
> Thanks for the link, but making it a charity will involve a lot of work
> for a number of people, and terrible legal responsibilities.
>
> All we need to do is to establish the user group as a Legal Entity
> being a community association, so that we may have a bank account.
>
> Helen McCall
>

Hi All,

Rather than a full charity what about a Community Interest Company? (CIC) The bar is lower for a CIC than a charity, albeit you do need to register the names and details of Directors with Companies House.

(AI response so /may/ be inaccurate) 'A CIC, or Community Interest Company, is a special type of UK limited company that exists to benefit the community, rather than for private profit. It is a hybrid between a charity and a traditional company, using business activities to achieve social objectives. Key features include an "asset lock" that ensures assets are used for the community's benefit and a requirement to file an annual report on its social activities.

    Key characteristics

• Community focus:
  A CIC is formed to serve a community interest and reinvest its profits to further its social goals. 
• Asset lock:
  This is a legal promise that the company's assets will only be used for its stated community purpose, and it places limits on how much money can be paid to shareholders.
• Public reporting:
  CICs must submit an annual report detailing their activities and how they have benefited the community. This report is publicly accessible.
• Hybrid structure:
  It is a limited company registered with Companies House, but it is not a charity. While it can operate as a traditional business, its profits are reinvested in the community.
• Flexibility:
  CICs are designed to be relatively easy to set up and can have features similar to limited by shares or limited by guarantee companies.
• Shareholder limits:
  If a CIC has shareholders, there are limits on the profits that can be paid out to them.
  

    How it differs from other structures

• Charity:
  A CIC is not a charity and is therefore not eligible for some charity-specific grants or tax breaks. 
• Traditional company:
  While it has a similar legal structure to a traditional company, its primary purpose is social good, not private profit for shareholders.'

That would establish DCGLUG as a Legal Entity allowing us to have a bank account, and also allow us to promote our community driven focus :)

If there's interest in becoming a CIC I can ask the chairman, treasurer, and/or secretary of the local war museum's CIC to comment on setting it up and running it, as they've been going about a year.

Kind regards,

Julian

-- 
The Mailing List for the Devon & Cornwall LUG
FAQ: https://www.dcglug.org.uk/faq/