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charity status to limited company


katblondy1
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Would like some advice/thoughts on how to move on from being a committe led community playgroup to the playleader and deputy taking over the running of the setting.

Our committee are really not interested and have not been motivated for some time, we feel that we are being let down by them. We had an outstanding Ofsted 4 years age and they are due anytime, we want to maintain the high standard but feel we can't continue with this commitee.

 

Has anyone on the forum taken over their setting?

What does it involve?

Any advice/help on how to do this would be appreciated

Thanks :D

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I took over a setting but not as a limited company. I am a sole trader. Do you have a reason for wanting to become a limited company or could you and your colleague become a partnership? I'm not sure what the implications are of becoming a limited company, but I think there are pros and cons either way. I would seek the advice of an accountant and/or solicitor before taking the plunge. Sorry not be be more informative. Someone will probably be along with more of an idea about limited companies.

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Thanks for you reply. Can 2 people become sole trader? Myself and my deputy want to take over the running together, we have worked well together for a number of years. Our committee really are dire!! We do all the work anyway and they really have no clue about childcare or how to run a setting. We have just been looking on the charity commission website, not much help on there.

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When you move from a charity to a limited company you will have to completely close the charity. All the money in the account has to be given to charity, then you open up the group as a new business, with no money in the account, you have to have a meeting with the committee and they set a price for you to buy the resources, this isnt usually very much, usually car boot prices. You also have to re-register with ofsted and they come out and do a new inspection as a new setting. The benefit of a limited company is that the risk is on the setting, you dont have to put your property on the line if anything goes wrong.

You can open up in partnership with someone else, you become known as directors, this does help to share the load.

You then have to register with companys house, this is easy to do, you can do it online. Hope this helps.. Good Luck with what ever you decide.

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Thanks for your reply. Have you done this in your setting? Did you consider being a Charitable Incorporated Organisation (CIO) or Community Interest Company (CIC)? Our Committee know nothing about this at the moment, we are exploring our options but know that we cannot continue being a committee led pre school due to lots of problems and issues with the committee not doing a thing!! Surely the days of committees are numbered, they are lovely people but have no clue how to run a pre school!

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Although i know what simcity is saying ...you are able to have a registered charity as a limited company...just to clarify!

If you and your deputy want to take over the business you will need to be a partnership. If the pre-school is a charity then they would be able to sell you the items for the pre-school when they have valued them. Your registration with ofsted would change and to my knowledge you would have to re-regiter.

We are now a limited company (and charity) but you still need a board of trustees to oversee things if you want to go down this line....which might mean you don't get rid of the committee !

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We have dropped the charity status, so we didnt have to have the trustees, we still do fundraising , what we did was we have a few parents who are fundraisers, they have their own bank account, they raise funds for the pre-school then make donations to the pre-school. They are known as the friends of...... then the name of the pre-school, just like schools do.

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I believe if you contact the pre-school learning alliance they have something they do now that you do not need a committee, after we had completed everything a lady from the psla visited us and said they had a model we could of used, might be worth looking into.

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We have dropped the charity status, so we didnt have to have the trustees, we still do fundraising , what we did was we have a few parents who are fundraisers, they have their own bank account, they raise funds for the pre-school then make donations to the pre-school. They are known as the friends of...... then the name of the pre-school, just like schools do.

 

 

Can you just drop the charity status?

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I thought you had to close a charity run setting but not 100%.

Saying that I can't see why you couldn't re-register before the other one actually closes. I know a few years ago if a charity run setting closed and was part of the PLA the resources would go to the PLA. The setting would have to buy them back from them. When we took over we were owned by the local council so didn't have the charity problem. We are a partnership which I would not change.

Why don't you get in touch with your development worker. They should have up to date information or at least know where to find it.

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if you close the group to reopen it check the staff employment status you may be entitled to redundancy payments from the closing funds, even if you plan to re-open as a new group and employ the same team of staff, I say this because if you and the deputy are planning to buy all the preschool equipment the redundancy pay out might come in handy.

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Hi Cait, when we closed as a committee run pre-school, we closed down the pre-school and the charity, gave any money to charity then re-opened as a limited company with no charity status, hope that makes sense....

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  • 4 weeks later...

Dissolution

If the Committee decides that it is necessary or advisable to dissolve the Group it shall call a General Meeting of all members under the provisions of Clause 5. If the proposal is confirmed by a two thirds majority of those present and voting the Committee shall have power to realise any assets held by or on behalf of the Group. Any assets remaining after the satisfaction of any proper debts and liabilities shall be handed to any similar charity concerned with the education or care of children in the area of the Group. If there is no AGM for two successive years, and if no member of the Committee makes the necessary arrangements, any other member may do so. A copy of the financial statements or the final accounting period of the Group must be sent to the Charity Commission.

 

Thats what it says on our constitution.

Let us know how you get on :1b

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  • 1 month later...

Thanks for your reply. Have you done this in your setting? Did you consider being a Charitable Incorporated Organisation (CIO) or Community Interest Company (CIC)? Our Committee know nothing about this at the moment, we are exploring our options but know that we cannot continue being a committee led pre school due to lots of problems and issues with the committee not doing a thing!! Surely the days of committees are numbered, they are lovely people but have no clue how to run a pre school!

 

Hello Katblondy1

 

Do you have any knowledge of becoming CIO? It's something I'm looking in to at the moment, but im unsure what the difference is between incorporated and charitable incorporated, any advice to offer?

 

Thank you :)

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