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Starting CIC while claiming benefits

Debbi Minshull Administrator at Wellmindz Posted 2 years ago

Hi, I'm considering setting up a CIC with a friend but can't find out if this will affect our right to claim benefits. We are really passionate about what we want to do for our community but can't afford to be without our benefits.

Can anybody clarify this for us before we start the process??

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Anne Kazungu Okwera Staff PANEL

Executive Director at Light Empowerment Foundation 1 year ago

Hi you would have to register or update your status to self employed with universal credit then benefits will be paid based on your monthly income and expenses declaration

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Hirsch Sharma Staff PANEL

CEO at Boardroom Consultants 2 years ago

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Does that not depend on the amount you earn. It is best to check with who you are getting the benefits from.

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Ryan Jarvis Staff PANEL

Service Manager at Conviction 2 years ago

Hey Debbie

As long as you are open and honest with the benefits department (up front) that manages your claim, they should be ok with this. (I would think about ensuring your CIC is set up on a not-for-profit basis - Limited by Guarantee - to avoid any accusations of being able to take an income from the CIC).

It may be that a charity or charitable company would be more appropriate if you are not intending to take any income, but wish to set up the organisation for the benefit of the public and would be happy having solely charitable aims and objectives.

Please see some further guidance here.

Volunteering and claiming benefits
CIC Guidance - In Depth
Set up a charity guidance

Hope this helps
All the best
Ryan 😊

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A CharityConnect User Staff PANEL

at 2 years ago

If you are intending to be paid anything from anyone, including your CIC, I expect that would effect your benefits. If you set up your CIC but aren't receiving any benefit or income from it, that's a different matter.

My query would be why a CIC? Will your organisation be creating an income stream? Have you fully investigated other structures before going own that route? We come across so many groups that have set up as a CIC - partly because it's relatively straight forward to do - but probably isn't the most appropriate structure for their organisation or activity. Please seek advise!

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