A Community Interest Company (CIC) is a special type of limited company designed for organisations that operate for the benefit of the community rather than for private profit. 

To qualify, the company must be either limited by guarantee or by shares and must clearly demonstrate how its activities provide a tangible benefit to the community. 

Follow our step-by-step guide on how to register as a CIC.

Advantages

  • Limited liability 

Members and directors are protected from personal financial risk.

  • Clear structure

Offers the familiarity of a limited company model, suitable for clubs that want to function as social enterprises without becoming a charity. 

  • Community-focused safeguards

The asset lock and community interest test ensure that the organisation remains committed to serving the public good.

  • Access to Grants and Funding

While not a charity, a CIC is still considered a not-for-profit organisation, and many funders (e.g., Sport England, local authorities, National Lottery) accept CICs for community sport grants. 

You'll need to show reinvestment into the club—like offering free or subsidized sessions, community outreach, or supporting underrepresented groups. 

  • Freedom from Charity Commission Oversight

Unlike charities, CICs: 

  • Don't need to register with or report to the Charity Commission 
  • Can pay directors (if approved) 
  • Have simpler reporting requirements 

This makes a CIC a flexible middle ground between being a regular company and a full charity.

Disadvantages

  • Use of assets is restricted

The asset lock limits how assets can be distributed, ensuring they remain within the community. 

  • No access to charity tax reliefs

CICs are not eligible for the same tax benefits as registered charities. 

  • Ongoing compliance

CICs must meet annual reporting requirements, including submitting a community interest report to the regulator.