Social Investment Tax Relief (SITR) A help or a hindrance?

We thought we knew what a Social Enterprise was and the social economy, as a whole, was growing nicely until government decided to tell us what a Social Enterprise is.  They introduced Social Investment Tax Relief (SITR) and said that it was available for Social Enterprises and then said  Charities and CICs only. That fragments the sector because it is being said that Social Enterprise is an entity that earns income for the social entrepreneur but is not available for the creation of capital.  To provide social benefit it is necessary to generate revenues and to create capital. Continue reading

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CICs, Charities and SITR

A Community Interest Company (a CIC) is a limited company designed by statute as a vehicle for social enterprise. It must have a special constitution specifying the social aims and containing:

  • a restriction on the transfer of assets out of the CIC to ensure they continue to be used for the benefit of the community;
  • a restriction on the amount it can pay investors.

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To be a CIC, Charity or Hybrid - that is the question.

corporate responsibilityIf you are scratching your head about what vehicle to use, a CIC or a Charity why not try a Hybrid, that’s the structure that generates revenue for social benefit and that also has an eye on creating value from an exit. A Hybrid involves a Community Interest Company limited by guarantee that holds all the intellectual property rights (IPR) and licenses the IPR that it owns to a trading company which is in fact the head licensee. The head licensee is a limited liability trading company controlled by the Community Interest Company  via a licence and a golden share and the trading company can conduct its activities in the ordinary course of business, have its own investors and under the licence from the CIC it will pay a gross profit royalty to the CIC that the CIC can apply for social benefit. Continue reading

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The Changing Face of the Practice of Law

During the period I’ve been a solicitor, the practice of the law has changed beyond recognition particularly in the area of competition. At one time if you gave out too many business cards you were likely to be reported to the Law Society, probably by other solicitors, for “touting”. In the late 70s I wanted to have new artists works displayed in the office to help artists by inviting clients and contacts to view the art and buy. When I checked with The Law Society, that was prohibited on the grounds that it would attract people into our building who would not normally go there.

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