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Are CIC's to be avoided.

Do you treat CIC's as a loss leader or just avoid them.

I was recently approached to act for CIC. I have not been involved with these before but by there nature I suppose they will not great clients.

The endeavour they were doing was to provide work space for startups and popup shops etc. I offered to do the job at basically cost plus offered to do a surgery type of arrangement where I could attened periodically to offer support. She rejected the offer and was quite short in her response as if I was some sort of Dick Turpin. Do others look after many of these on a pro bono basis or do some with better funding have more funds to pay for advice?

Do you get spin offs from them if say the members who have set up the CIC for social reasons but have other businesses outside of it.

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01st Nov 2017 15:50

They area dog's breakfast of an idea - neither a charity or a business. Any enterprise with that word 'community' in it is best avoided.

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to memyself-eye
01st Nov 2017 15:54

By its very nature is just seems pointless but someone must do the reporting requirements for them.

Who makes these schemes up.

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By Ruddles
to memyself-eye
01st Nov 2017 16:50

I beg to differ. We act for, and are proud to be associated with, a number of very commercial and successful well-managed CICs, who have no difficulty in meeting our fees - which tend to be slightly higher than comparable Ltd's.

But no doubt there are a number of CICs that have been set up becuase it was the 'in' thing to do.

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01st Nov 2017 16:55

I avoid. Recently declined an existing client's invitation to act for a CIC that he had recently become involved with.

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By Brunel
01st Nov 2017 20:45

CICs may get Business Rates relief in some areas, many SMEs pay more BR than CT.
Some public bodies are uncomfortable contracting services to evil for-profit companies but seem happy with CICs.
Another Gordon Brown brainwave I think?

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02nd Nov 2017 10:33

CICs have a place but not a huge one.

I've never avoided them nor have I charged less than I would have to a normal company. They're not charities and neither am I.

Obviously if it was a cause close to my heart, I'd reconsider but that's not arisen as yet.

For me, the classic CIC situation is the village shop. Fair sized asset in the property, staffed largely by volunteers, there for the convenience of the community, allows for a modest return on the money that villagers have invested to buy the property,

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02nd Nov 2017 10:29

CIC - no need to avoid just treat them as you would any other company.

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02nd Nov 2017 12:15

I tend to avoid them, charities too. Made a conscious decision that I didn't want to have to worry about keeping up to date on charity legislation.
We have a local firm who specialises in not for profits so I tend to point them there.

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to accountantccole
02nd Nov 2017 13:28

Totally agree.

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By Ruddles
to accountantccole
02nd Nov 2017 14:03

See Mr T's comment above. Other than the reporting to CIC Regulator, there is nothing special about preparing accounts or tax returns for a CIC. We find our CIC clients much better at managing records and settling fees than many of our 'ordinary' company clients.

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to accountantccole
02nd Nov 2017 14:27

If you're avoiding CICs because you don't want to keep up with charities legislation, you're wasting your time.

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02nd Nov 2017 15:14

Well there's also the issue that you often have to deal with a committee of n people and therefore n sources of opinions/queries to deal with.
But clearly some posters here are able to do the work profitably.

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By Matrix
02nd Nov 2017 17:29

Agree with the above, I have one charity and a client's wife asked about setting up a CIC a few months ago so one potential CIC now. It is hard enough having to keep up with everything for one charity, I don't know if I would also want to keep up to date with CICs for one CIC. Also I don't think they'll have any money.

If they set it up, I would also have to do some additional work in determining if it is trading, have others had to do this too?

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to Matrix
02nd Nov 2017 17:35

There's an extra report for a CIC - which the directors have to do, not you.

And you need to be aware that you have to file on paper, so no deadline surfing.

Jeez - it's not rocket science. Quote for the work and see if they accept.

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By Matrix
to lionofludesch
02nd Nov 2017 17:58

I quoted (after researching it all including the Director report and paper filing and extra analysis on whether trading or not).

However I am not that bothered about getting it if it goes ahead. They need funding so they must still be waiting and because it is a worthwhile cause will expect a lot for a low price.

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to Matrix
02nd Nov 2017 18:18

Price isn't affected by whether they think it's a worthwhile cause. Only if you think it's a worthwhile cause.

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By Ruddles
02nd Nov 2017 18:56

It seems that there are 2 types of CIC - those that think they’re charities in disguise, and those that are profitable trading entities, benefiting from access to funds from public and private grant-funding bodies. I guess that we’re fortunate in dealing with the latter.

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