Limited by Guarantee Company with Charitable status

Being a charity is a matter of status, not of organisational structure. It is possible to secure for a number of different structures. The issue is essentially whether the objectives of the organisation are accepted as charitable by the Charity Commissioners, and it has an appropriate constitution. Because of its not-for-profit nature, a company limited by guarantee with charitable objectives can apply for charitable status.

Among the advantages of charitable status are:

  • It presents an image of probity to other people and so helps to gain their support.
  • It opens up sources of funds. Generally charities will only give to charities, and other donors prefer to give to charities.
  • If there are any surpluses, a charity will not be charged corporation tax, while a non-charitable company limited by guarantee may be.

Among the disadvantages are:

  • Limitation on trading unless in pursuit of objectives.
  • Charities should not campaign politically.
  • Obtaining charitable status can take some time.
Formacompany & Co Ltd
11 Church Road
Great Bookham
KT23 3PB