There are a range of ways a voluntary or community group can be set up. Some are informal associations with a basic constitution – a set of rules which set out what a group is set up to achieve (its aims), how the group will achieve them (its objects), who its members are and how it will make decisions and ensure that its money is safeguarded and managed effectively.
Others are more formally established and chose to register as a Charity or as a Company of some description or both. A new form of Charitable Company is now available called a Community Interest Company (CIC) and another, the Charitable Incorporated Organisation (CIO) is likely to be a possibility from early 2008.
More formal legal structures are especially important for those with an income above £5,000 a year and groups who take on buildings or start employing staff.
Obviously setting up the right legal structure is crucial - it affects what the groups is legally allowed to do and whether it is liable for particular taxes.
This can be a complicated process and if you are new to this area you will need to seek some expert advice. Some starting points are provided below.
