CIC Association

Serving Community Enterprise

I hardly dare ask this question with all the recent tax avoidance headlines, but here goes...

I understand that as a CIC we have to pay corporation tax on profits. I've heard the view that a good accountant should be helping with reinvesting etc before year end so profits are minimal to avoid paying hefty tax. BUT, I'd like to be able to save some profits to use when times inevitably get tough.  Do we just have to bite the bullet and pay tax every year on any 'reserves', or is there a tax effective way to save? I'm probably thinking along the lines of ISAs, which I'm familiar with as an individual, but have no idea if there is an equivalent for CICs. Or is there any other way?

Obviously only legal/ethical solutions will be considered.... :)

Views: 129

Reply to This

Replies to This Discussion

Basically, No there is not. Not simple ways at least. You can try being clever about when you should recognise your revenue (if you have contracts that extend past year end), but this is probably not relevant for most.

 

Another option would be to set up a sister charity, donate to it and then do good stuff out of this charity. But this is expensive on legal fees so you would need to be making quite a lot of profit before this became worthwhile.

 

I believe there is a real social enterprise opportunity for a charity that offers this service to all CICs; each CIC donating to a separate fund within the one charity, which the CIC then has some control over how is spent on doing good deeds the CIC likes at a later stage.

RSS

Groups

From Funding Central

Events

© 2017   Created by John Mulkerrin.   Powered by

Badges  |  Report an Issue  |  Terms of Service