Community Interest Companies (CICs) have been invited to test the Companies House’s new online filing service.
The new service will allow CICs to file annual reports and accounts online.
What is a CIC?
A CIC, also known as a ‘social enterprise’, is a type of corporate entity which benefits the local community.
They are usually limited by guarantee, rather than by shares, and are not classed as a for-profit or charity organisation.
Companies House says CICs are more flexible than some other legal forms and there’s a variety of capital options to meet the needs of business owners.
Profits are divided between the business owners and the community “reasonably”, so that the community is always the first to benefit.
How to incorporate a CIC
To set up a CIC, you will need to apply to Companies House and meet a selection of specific requirements. These include:

• include a ‘community interest statement’, explaining what your business plans to do
• create an ‘asset lock’- a legal promise stating that the company’s assets will only be used for its social objectives, and setting limits to the money it can pay to shareholders
• get your company approved by the community interest company regulator – your application will automatically be sent to them

The regulator has identified a common list of do’s and don’ts of completing an application to incorporate a CIC, found here.
The Office of the CIC Regulator
Interestingly, CICs report to their own regulator, known as the Office of the CIC Regulator. The regulator ensures that the CIC is genuinely carrying out its social aims and is not misappropriating funds.
For more advice
If you would like more advice on setting up a CIC, or to decide if a CIC is the right corporate entity for you, please get in touch.