What is a community interest company?

Community, or CIC, is a specific and defined type of society in the UK. It is designed to cover companies to work for the benefit of the public but are not entitled to a charity position. It brings several advantages and at the same time it is more flexible than a rule of a charity organization. The term may be used in other countries, but does not necessarily have the same legal consequences. For a traditional society, the proceedings are usually expected to use and even sell assets to maximize profits; In some reports this may be a mandatory goal. For CIC rules, they mean that assets cannot usually be transferred to owners or shareholders. If assets are sold, they must be sold at a fair market price and revenues used to work on the social objectives of the company. If the interest in the Company community is over, its assets must be transferred to another company with similar goals.

The main advantage of running a community interest company, unlike a charity organization, is that the qualifications criteria are much weaker. There is a wider range of activities and goals that can qualify for CIC society. CIC also has a much greater flexibility of how it behaves than charity. For example, it may not be as strict in terms of justification that a specific decision or policy fulfills the objectives of the organization. The biggest disadvantage is that CIC does not have the same tax advantages as a charity organization.

There are some specific restrictions on the establishment of a community interest company, except that it is not a charity. As expected, it cannot perform any illegal activity. Unlike a traditional society, it cannot be set up with the intention of serving the company's arrows in particular. It cannot work to carry out any politically motivated activities.