Incorporation

Some charities move from an unincorporated structure to a company limited by guarantee structure or IPS. This process is called ‘incorporation’.

Incorporation is quite common when a charity grows in size and complexity. Incorporated charities have their own legal identity which provides trustees with some (although not comprehensive) protection from personal financial liability.

When a charity incorporates, it establishes a new company limited by guarantee or IPS, registers it as a charity and then transfers the assets and liabilities from the old unincorporated charity to the new charitable company. 

Incorporation can be complex and professional advice is usually recommended. Some guidance is also available from the Charity Commission.