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Helping Scottish Charitable Companies become a SCIO

From 1st January 2012, charities that are companies or industrial and provident societies (IPS) can apply to the Office of the Scottish Charity Regulator (OSCR)?to convert to a Scottish Charitable Incorporated Organisation (SCIO).? Previously it was only unincorporated associations or trusts who could take advantage of this change. We help?Scottish Charitable Companies become SCIOs.

However, the conversion of a company or IPS to a SCIO may only take place if:-

  • In the case of companies, the company has more than one member
  • If either the company or IPS has a share capital, that share capital is fully paid up

The company or IPS considering conversion to a SCIO should carefully consider whether it would be to their advantage or disadvantage and should seek advice as necessary to ensure that becoming a SCIO is the most appropriate step for the charity.? Click here to see our previous blogs for more information.

Following approval

Following approval by OSCR to the conversion, they will register the relevant documents and cancel the registration of the company or IPS.?? It is at this point that the company or IPS is automatically converted to a SCIO and all property, rights and liabilities of the converting company or IPS become the property, rights and liabilities of the new charitable organisation.

OSCR has produced guidance that explains the SCIO and its key requirements and this can be found by clicking here.? Section 2.1 of this guidance contains a table which should be studied by any organisation considering conversion.

Once an organisation has converted to a SCIO it is:

  • a corporate body
  • able to enter into contracts, employ staff, own property, incur debts,
  • able to sue and be sued and therefore provides protection against personal liability for its charity trustees
  • not subject to the same reporting and regulatory requirements as a company or IPS.

Unlike a charity which is a company or IPS, a SCIO:

  • reports to OSCR as its sole regulator for registration purposes.
  • is subject to the same accounting thresholds as unincorporated charities.

Please contact our charities team?if you would like any additional information or wish to discuss your charities specification requirements in more detail.

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Written by : Super User