Group or integrated structures

Sometimes it is desirable to set up more than one legal entity for an organisation. Usually this is because an activity cannot be carried out by law under the first legal entity; tax efficiency, ring-fencing risk, or the need for the clear separation of the management of different operations.

Examples of this include: 

• A social enterprise or business with an associated charity to run the parts of its operation that can receive charitable status.
• A charity and its wholly owned trading subsidiary.
• A social enterprise with one or more subsidiary companies.  Businesses often set up subsidiary companies to ring-fence particular risks. For example, one company may own property and lease it to a related operating company that deals with the service provision, which is run from the building.
• A federation consisting of one umbrella organisation and a number of local organisations. Each local organisation may have the umbrella organisation as its sole member. In addition, the local organisation may be linked to the umbrella body through a contract that franchises the business model and/or licenses use of the brand name and logo.

 Read more on choosing to be a charity.