Roman kozlowski

1. Set up as a sole director, once running increase to 3 directors, and trade as a CIC limited by guarantee. Sounds OK

2. Can the CIC work for the community and still raise funds in a normal way. i.e. I provide Forest School training and courses for children and adults. Can these courses continue at market rate and be used to pay for director salary and re-invest profit to provide free courses for community groups identified in my IN01, CIC36 ? a CIC is a business like any other so you can pay salaries to people who make it happen, the board Directors are a different matter. They can get expenses if they require but they can't take money for their own private purposes. I don't have any PAYE. I have 3 Directors on the Board. But 3 people who give hours and hours of their time invoice the company for their specific skills from their individual sole trading companies. Yes market rate why not? It’s up to you how you re invest. I have learned that volunteer and good will can last quite a while but it will wear thin and there is a lot of coming and going. You need to make sure you create the revenue and get the grants if you wish. The grants or funding could be used for free courses and profits for something else like your time. A CIC is a hard game. Don’t make the mistake of giving your time for nothing indefinitely or spending money which you don’t log as being owed to you. Whatever you spend or whatever you want to charge the company have it on the creditors list to log your worth to the CIC even if at the end of the day you don’t take it. A bit cynical I know but I’ve lived and breathed it an learned lessons.

3. Does a CIC have to rely on external funding, grants ? No absolutely not. You can use the non profit as leverage but you can make sales

I hope I am right in all this

Dawn

Comments

John Mulkerrin March 25, 2016 at 4:08pm

The advice below is spot on, James is a fount of knowledge and I would re-iterate Dawns comments about logging your own investment of time and money accurately.
Dawn Birch-James March 23, 2016 at 7:37pm

1. Set up as a sole director, once running increase to 3 directors, and trade as a CIC limited by guarantee. Sounds OK

2. Can the CIC work for the community and still raise funds in a normal way. i.e. I provide Forest School training and courses for children and adults. Can these courses continue at market rate and be used to pay for director salary and re-invest profit to provide free courses for community groups identified in my IN01, CIC36 ? a CIC is a business like any other so you can pay salaries to people who make it happen, the board Directors are a different matter. They can get expenses if they require but they can't take money for their own private purposes. I don't have any PAYE. I have 3 Directors on the Board. But 3 people who give hours and hours of their time invoice the company for their specific skills from their individual sole trading companies. Yes market rate why not? It’s up to you how you re invest. I have learned that volunteer and good will can last quite a while but it will wear thin and there is a lot of coming and going. You need to make sure you create the revenue and get the grants if you wish. The grants or funding could be used for free courses and profits for something else like your time. A CIC is a hard game. Don’t make the mistake of giving your time for nothing indefinitely or spending money which you don’t log as being owed to you. Whatever you spend or whatever you want to charge the company have it on the creditors list to log your worth to the CIC even if at the end of the day you don’t take it. A bit cynical I know but I’ve lived and breathed it an learned lessons.

3. Does a CIC have to rely on external funding, grants ? No absolutely not. You can use the non profit as leverage but you can make sales

I hope I am right in all this

Dawn
James Macfarlane March 23, 2016 at 7:11pm

Dear Roman It might be better to ask your question in the discussion forum rather than by sending a group message. In reply to your question:

1. Yes, this is entirely possible

2. Yes, but directors' salaries must by law be 'reasonable' and reflect market rate

3. No, if the CIC can survive on trading income then that is great!Regards

James

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Roman kozlowski

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