What’s the big dream? Here is mine

Founding a community interest company will have you feeling like you could conquer the world. It opens up so many opportunities and possibilities, you can wake up every morning for work feeling like it’s Christmas. If you design it right! 

First, there are the exciting projects you can get grant funding to do. Your mind will whirl away thinking of lots of great ideas for projects you're passionate about, you will enjoy and that make a real difference to the people you're helping. That’s a dream right there. 

Play your cards right and the best part is you get recognised for it. Organisations and people start approaching you and asking you to do workshops or talks or they commission you. You are now a go to person in your specialism. This opens up a new world of possibilities. You can start to leverage your specialism. You could even start training others or write a book. Get entrepreneurial and build your empire. 

The wonderful thing about a CIC is you still get to be entrepreneurial on top of getting grants and donations for your work. Plus many of you will have an LTD on the side as well. All set up to focus on making you money. There are so many ways you could make extra money and one maybe your million pound idea! Think about what you could create that there is a need for. The digital world makes it so easy to start a membership, online course, self publish books or journals, and sell a service. Or you may create an app. Creating something that the public sector needs is a winner. Think of a solution for the NHS, schools, prisons. Something you can sell them that solves a problem for them. That’s where the big money is.

With all this money coming in from grants in lump sums and hopefully other good income from your work, you will be in exciting new territory with your personal finances. It will open up a ton of new possibilities. You could invest your money into businesses or properties. Or just pay yourself and cash out. Paying yourself and reducing your tax bill is always challenging. You need to be smart. Here is my tips based on how much your cic earns;

Level 1 - up to 20k

You may have employment or be on UC and your CIC money is not enough to be your sole income. It is probably best to pay your CIC to yourself as a self-employed person. You don’t want to be second job taxed, so don’t PAYE yourself from your CIC if you already have employment . Remember to save your tax for the end of the year and to offset as much as you can in expenses. 

Level 2 - over 20k - 50k

Now you're rolling on a full time main wage. I would now think about setting up a LTD alongside the CIC. Invoice your CIC and when the money for your work is in your LTD you should set up PAYE and employ yourself. 

Tip if you employ yourself your LTD will need to pay employers NI (this is on top of your lien NI). It’s quite a sting. To avoid this bill employ a second person on PAYE. You could just pay them £50 per month. Then your accountant can apply for a £5000 employment allowance. This will wipe out your LTD’s NI bill. 

Another tip is keep your PAYE wage low and pay the rest to yourself in dividends. Even though you will have to pay Corporation Tax you will still pay less out and get to keep more yourself. 

Remember you can pay yourself in lump sums and don’t have to pay a set amount each month. 

Also remember there are lots of tax benefits in having an LTD which is why I say that’s best and not PAYE yourself though your CIC. You can get things like a van tax free or a proportion of your car costs, ‘working’ holidays, meeting expenses like lunches, parking etc. £26 of utilities if you're working from home. Equipment and assets. There is just so much more room in a LTD that you’d be restricted on if you just used your CIC. 

Last tip is, by having an LTD, CIC and even a self employed set up as well you can spread your income out and stay under the VAT threshold. If you go over £85k on any of these you have to register for VAT. You don’t want that! 

So what’s your big dream? 

If you got rolling with all this and starting to make it big, what’s your end dream? 

I’m going to share mine with you. It might get you all thinking. 

I am ten years in to having CIC’s. I’m at a point where I will likely do two grant funded projects a year. Just heritage lottery and arts council. That gives me a nice lump sum boost into my finances though my self employed account. 

 My main job now is my CIC mentoring which gives me my monthly PAYE wage though my Kexx LTD. 

Them, I have Change Course, my other LTD. I have used this in the past to sell my rehab programme to the prisons (which I funded though CIC projects and paid the LTD, using this investment to grow the company). I also bought a shop (in lockdown using the bounce back loan) and renovated it. Again I used CIC grant money to hire the space for exhibitions, this gave me money to invest in renovating it). Now I am planning on developing a CIC course for the DWP. If that takes off and generates money I will leave it in the LTD and use it to buy property to rent out as emergency housing. Local authorities will pay hotel rates for properties so it’s very lucrative and it helps people who desperately need it. 

But my big big dream is to grow enough money in Change Course to buy land to build a rehab centre here in Cornwall for mental well-being and anyone who needs a retreat. I have spent time in Bali and want to create a Bali style yoga area, infinity pool in nature and have loads of creative activities. That’s my end goal. My big dream. 

I can do this and at every step having a CIC on side to get grant funding to run cool projects that bring the community in and help people. Along with giving that cash injection investment. It’s a winning formula. 

So let’s build our big dream. 

Kexx 🫶🏼