Social Enterprise Company or Charity?

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Caitlyn

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Wait a minute... isn't a Social Enterprise the same as a charity?

The answer depends on the company’s objectives; some social entrepreneurs may want to register the company for Charitable Status because the profits will be tax-exempt. Owners would need to register a social enterprise as a Company Limited by Guarantee (CLG) to be eligible for Charitable status. CLG companies do not have shareholders to distribute revenue because the profits are reinvested in the company and further initiatives that benefit the community.

The difference between a social enterprise and a charity is:

  • Charities are typically involved in fundraising activities such as street collections, raffles, and other fundraising events to generate donations.
  • Social Enterprises typically have the same vision or mission as a charity, but they will generally focus on trading in order to generate profits.

Find out how to register a Social Enterprise Company
 
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