Sun, 27 Feb 2022 00:00
The club is proposing to become a Charitable Incorporated Organisation (CIO).
Q: Why should the club incorporate?
A: The club is currently an unincorporated association (see https://www.gov.uk/unincorporated-associations for a definition). As such, "Individual members are personally responsible for any debts and contractual obligations". The club has grown significantly over recent years - both in terms of its membership, tennis services offered (e.g. Pay and Play) and the assets it is responsible for (e.g. lease and floodlights on all 4 courts). The committee believes that incorporation will help to protect members and the long-term future of the club.
Q: What happens if we stay as we are?
By remaining an unincorporated association, members will continue to be personally responsible for debts and obligations. This places a particular burden on committee members, lease trustees and volunteers (e.g. member session organisers). It may also prevent us accessing some sources of funding for improvements to our facilities.
Q: Why become a CIO?
The club looked at various options in 2018, including taking guidance from TVBC. It was concluded that CIO was the preferred option for the following reasons:
- Incorporated status reduces members' financial liability.
- The club provides tennis opportunities to the community and does not make a profit.
- Charity status makes it easier to access grants and other sources of funding.
- CIOs are registered with the Charities Commission, whereas Community Amateur Sports Clubs (CASC) are registered with HMRC. We understand that this results in a "lighter touch" reporting for CIOs.
- CIO status provide a number of tax benefits. These could be significant in terms of further investment in the club's facilities.
Q: How many other tennis clubs have become a CIO?
A 2019 club survey done by the LTA indicated that most smaller clubs are unincorporated associations. A search of the Charities Commission register only shows a (relatively) small number of CIO tennis clubs. However, it does show many other sports clubs who have become CIOs. Comments from the LTA's legal partner and other clubs indicate a significant backlog of applications to the Charities Commission as more and more clubs look to become CIOs.
Q: Why did we not become a CIO in 2019?
The club balloted members in January 2019 on becoming a CIO. This was approved by members and adopted at the following AGM. However, we overlooked the need to change the club's existing constitution in order to allow the transfer of assets. This is why were are conducting a new ballot.
Q: Will it change how the club works?
We don't expect the club to change on becoming a CIO. The purpose in draft CIO constitution is very much inline with the current aims and objectives of the club:
- To offer coaching and competitive opportunities in tennis
- To promote the club within the local community and tennis fraternity
- To manage the Romsey & Abbey Tennis Club
- To ensure a duty of care to all members of the club
- To provide all its services in a way that is fair to everyone
Becoming a CIO will enable the club to hold the TVBC lease rather than individual trustees.
Q: Why does the club's existing constitution need to change?
First and foremost, we need to change the current constitution so that the club's assets can be transferred to a CIO.
Secondly, we thought it prudent to define the mechanism for approving the switch to a new incorporated entity. This text has been lifted from the CIO template constitution.
Q: What's the plan?
- Ballot members in March 2022 on updates to the existing constitution and the draft CIO constitution. NOTE: This ballot only commits us to changing the current constitution, which defines the mechanism for switching.
- Confirm that TVBC has no objections to the club becoming a CIO, and agree a plan for doing so.
- Prepare the 2021/22 accounts, using the charity reporting and accounting framework.
- Raise a motion at the 2022 AGM to adopt the changes to the current constitution.
- Raise a motion at the 2022 AGM to dissolve the current unincorporated entity and become a CIO (using the mechanism defined in the constitution updates).
- Aim to complete the transition to a CIO before the 2023 AGM.