Do a CIC's contracts and assets carry over on conversion?

Yes — it's the same body continuing in a new form, so contracts, assets and liabilities carry across, and any shares are cancelled. You'll still need to update mandates and notify counterparties.

Can you claim Gift Aid on donations from before conversion?

No. Gift Aid only runs from HMRC's recognition of the charity for tax; donations received while the body was a CIC don't qualify retrospectively.

Guides

Converting a CIC to a Charity (CIO): How It Works

Q: Do you need a solicitor to convert a CIC to a CIO?

No — there's no legal requirement. A straightforward conversion can be done without one, though the charitable-objects drafting and member resolutions are worth taking advice on.

Q: What changes when a CIC becomes a CIO?

It leaves Companies House for the Charity Commission: no more company accounts, CIC34 or confirmation statement, and instead a trustees' annual report, accounts and annual return every year within 10 months of year end. It enters the charity tax regime and is run by trustees, not directors.

Updated 11 Jun 2026

A community interest company can convert directly into a charitable incorporated organisation (CIO) — a charity registered with the Charity Commission — through a statutory process set out in regulations from 2017. It's a real legal conversion, not a rename: the same body continues, but it stops being a company and becomes a charity, leaving the Companies House and CIC regime behind for the Charity Commission's. The usual reason to do it is access to charity tax reliefs, Gift Aid and grant funding that only charities can reach.

Can every CIC convert?

No — there are gates to clear first. The Charity Commission will only approve the conversion if the resulting CIO would genuinely be a charity, and a couple of conditions block the application outright:

Your purposes must be exclusively charitable for the public benefit. The community interest test a CIC meets is wider than charity law, so some CICs don't qualify as they stand and need their objects redrafted before they can convert.
A CIC with shares can't convert if any of those shares aren't fully paid up. That has to be sorted first.
The conversion isn't open where the resulting charity would be an "exempt charity".

There's also a cleanliness check. The Commission can refuse if the CIC has accounts or reports outstanding at Companies House, if it's in an insolvency process, or if a director is disqualified from being a charity trustee. Getting your filing up to date before you apply isn't optional housekeeping — it's part of clearing the path.

How do you convert a CIC to a CIO?

The process runs in a set order, and three different bodies have a hand in it:

Pass a conversion resolution. The directors prepare it and the members approve it, either as a special resolution (normally at least 75% of votes cast) or by unanimous written resolution.
Adopt a CIO constitution. Use the Charity Commission's model CIO constitution as the starting point. This is where your objects have to be expressed as exclusively charitable.
Pass the resolution adopting that constitution.
Apply to the Charity Commission, sending the conversion resolution, the proposed CIO constitution, the resolution adopting it, and a Trustee Declaration Form. (If the CIC is a registered provider of social housing, you also confirm you've notified the Regulator of Social Housing.)
The Commission decides — and asks the CIC Regulator to confirm the CIC is eligible to stop being a CIC. The CIC Regulator's view here is decisive: the Commission can't approve the conversion over a negative decision from it.
Companies House cancels the CIC's registration. The moment it does, the conversion takes effect and the CIC becomes a CIO.

There's no legal requirement to use a solicitor, and a straightforward conversion can be done without one — but the charitable-objects drafting and the member resolutions are where things go wrong, so advice often pays for itself.

What changes once you're a CIO?

The conversion swaps one whole compliance world for another. The body is the same — its contracts, assets and liabilities carry on, and the people who were members of the CIC become the first members of the CIO — but almost everything about how it reports changes:

Regulator: the Charity Commission, not Companies House. You leave the company register entirely.
Filings: no more accounts at Companies House, no CIC34, no confirmation statement. Instead a CIO reports to the Charity Commission: it must submit an annual return and accounts regardless of income, with the trustees' annual report part of that reporting package, all due within 10 months of the financial year end.
Accounts: a CIO with gross income up to £250,000 can use simpler receipts-and-payments accounts; above that it prepares accruals accounts under the Charities SORP, with fund accounting (restricted, unrestricted and endowment funds). (That £250,000 ceiling rises to £500,000 for financial years ending on or after 30 September 2026 — a change already made law.)
Tax: you move into the charity tax regime — but the reliefs and Gift Aid only switch on once HMRC recognises the charity for tax, which is a separate application from Charity Commission registration. Gift Aid runs from that recognition; it can't be backdated to donations received while you were still a CIC.
Run by: charity trustees with charity-law duties, rather than company directors. The same people often continue, but their legal hat changes.

If you have shares, they're cancelled on conversion — a CIO has members, not shareholders.

Where the accountant comes in

The conversion itself is a legal and governance exercise, but the financial groundwork is what makes or breaks the timetable. An accountant's job here is mostly about getting you eligible and landing cleanly on the other side:

Making sure all CIC accounts, the CIC34 and the confirmation statement are filed and up to date before you apply — the gating issue above.
Working out the final period as a CIC and the opening position as a CIO. The financial year that straddles the conversion is accounted for under the charity rules, so the cut-over needs handling deliberately, not as an afterthought.
Translating reserves, restricted grants and designated funds into the charity fund-accounting framework.
Flagging the tax-status change and getting the HMRC charity-recognition application moving so reliefs and Gift Aid start as early as possible.

Frequently asked questions

Can a CIC become a charity? Yes — a CIC can convert directly to a charitable incorporated organisation (CIO), which is a charity registered with the Charity Commission, through a statutory process.

Do I need a solicitor to convert a CIC to a CIO? No — there's no legal requirement. A simple conversion can be done without one, though the charitable-objects drafting and resolutions are worth getting advice on.

What stops a CIC from converting? Objects that aren't exclusively charitable, shares that aren't fully paid up, or being an exempt charity all block it. The Commission can also refuse if your filings are outstanding, you're in insolvency, or a director is disqualified.

Does the CIC34 still apply after conversion? No. Once you're a CIO you file with the Charity Commission instead — a trustees' annual report, accounts and an annual return — and the CIC report falls away. See the CIC report for what you file beforehand.

Will my CIC's contracts and bank accounts carry over? Yes — it's the same body continuing in a new form, so contracts, assets and liabilities carry across. You'll still need to update mandates and tell counterparties, but there's no transfer to a brand-new entity.

Can I claim Gift Aid on donations from before we converted? No. Gift Aid only runs from HMRC's recognition of the new charity for tax; donations received while you were a CIC don't qualify retrospectively.

Thinking about converting, and want the filing and financial side handled so the application clears first time? See how we help CICs convert →