Social Enterprise and trading: Is It For You?

Let’s find out a bit more… It’s not new! Started in the 1840s. According to the 2012 Small Business Survey: – Approximately 70,000 social enterprises in the UK – Contribute £18.5 billion to the UK economy – Employ almost a million people It is a globally recognised activity

What do we mean by “trading” Trading and social enterprise Generating own income Selling goods/services/ knowledge Unrestricted income

Trading can be goods, services & knowledge – can you think of examples?

Why is trading a good thing? Have social and/or environmental purpose and reinvest their profits to achieve it Social enterprises tend to be based in more disadvantaged areas, employ local people, are more reflected of their communities in the governance A model that can enable people to do things for themselves Financial sustainability Income is independent.

Charity Commission on trading Charity Commission - Trustees trading and tax: how charities may lawfully trade (CC35)

A quick word on legal structures… You may not need to change your legal structure to trade. Dependent on what and how much you trade, and how it relates to you charitable objects.

Trading and tax 1.Primary purpose trading 'Primary purpose trading' is trading which contributes directly to one or more of the objects of a charity as set out in its governing document. (quote from CC35) Primary purpose trading can be undertaken will no implication for legal structures or corporation tax but may attract VAT 2.Non- primary purpose and ancillary trading – trading to raise funds(which in turn will be used for the charitable mission) have different taxation implications and may require a separate entity – a trading company – to protect assets of the charity).

Examples of trading Maison Bengal Belu Who Made Your Pants? Raise! Mental Health Make Sense Deaf and Blind Services Inspero Aurora

What you need to consider Commercial activity Market research Additional or existing resources Who are my clients Reputational risk

What could you trade?

Support Organisations Action Hampshire – – Co-operative Assistance Network – – WSX Enterprise – – Social Enterprise UK – –