DATE PUBLISHED: 18 Aug 2017 LAST UPDATED: 23 May 2022

Charity Structures

There are a number of different structures a charity can take and the most appropriate form will depend on the individual circumstances of the charity.

There are four main types of charity:

  1. Unincorporated Association. This is a membership organisation with a committee of trustees, appointed by an annual election. The charity trustees are individuals appointed in accordance with the rules of the charity and will carry out the day-to-day management of the association. An incorporated association does not have limited liability and therefore the trustees could be personally liable. An unincorporated association is unable to enter into contracts or hold property in its own name, rather it held by the trustees.
  2. Trust. A trust is usually governed by a Deed or Declaration of Trust and/or Charity Commission Scheme. The trust does not have legal personality or limited liability, which means the trustees could have personal liability. The trustees of a charitable trust will be charity trustees.
  3. Company Limited by Guarantee. Most charitable companies are set up as companies limited by guarantee. This is a corporate body registered at Companies House and must have articles of association. A company has limited liability and legal personality. This type of charity does not have shares, instead each member guarantees to pay a nominal maximum sum on liquidation (usually £1 or £10).
  4. Charitable Incorporated Organisations (CIO). This was the first legal structure created specifically for charities. CIOs must have a constitution in a specified form. The structure allows charities to benefit from limited liability without
    having to register at Companies House, and has legal personality. There are two types of CIOs: Association CIOs and Foundation CIOs.

Charities can also be formed:

  • By an Act of Parliament.
  • By Royal Charter.
  • As a Community Benefit Society (CBSs) (which are established and registered with the Financial Conduct Authority).
  • As a Share Company.

If you would to discuss the type of structure that would best suit your charity, please feel free to contact me via email, via phone on 01202 057768 or visit the charity team webpage for more information.

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