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Incorporation of Rugby Football Clubs

Incorporation of Rugby Football Clubs. Friday 5 October 2007 Serena Hedley-Dent. Constitutions used by RFCs. Unincorporated Members Club Limited Company Industrial & Provident Society. Incorporation – Why incorporate?. An unincorporated club has no legal identity of its own

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Incorporation of Rugby Football Clubs

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  1. Incorporation of Rugby Football Clubs Friday 5 October 2007 Serena Hedley-Dent

  2. Constitutions used by RFCs • Unincorporated Members Club • Limited Company • Industrial & Provident Society

  3. Incorporation – Why incorporate? • An unincorporated club has no legal identity of its own • As a result if it employs people or undertakes activities (eg organising matches), individuals (usually the Committee) will have to act on its behalf • If the club holds property, it will have to appoint trustees to do so • If claims are brought they would be against Committee members personally, who would be personally liable if the Club’s assets exceed the liability • Rugby is a contact sport where risk of personal injury is high and therefore claims by players against clubs a real possibility

  4. Incorporation – What form should a RFC take • Two options for non-profit making members clubs: • Company Limited by Guarantee • Industrial & Provident Society • In either case the RFC will have a legal personality of its own and as such can enter contracts, hold property, sue and be sued in its own name

  5. Are there disadvantages? • Companies and IPS are regulated by Companies House and the FSA respectively • The constitution and accounts will need to be lodged each year – but these have to be filed with the RFU anyway • The advantages OUTWEIGH the disadvantages

  6. How does an RFC incorporate? • Incorporation involves establishing the new company and then transferring the existing assets and undertaking of the club to it • Appoint a Steering Committee and decide timescale • Tell your members that this is planned

  7. Incorporation Steps • Prepare the Memorandum & Articles using the relevant RFU template • Apply for clearance from HMRC for the incorporation • Prepare the resolution of the members to transfer the assets and undertaking to the new company • Call and hold general meeting in accordance with your rules • Follow up work

  8. CASC Status • Finance Act 2002 – tax reliefs for clubs which qualify as community amateur sports clubs • Particular benefit to clubs with high rates; capital gains; or if will receive donations. • There are restrictions on CASCs particularly in relation to paying players to play • There are also criteria to meet to register as a CASC – you will need to fill in an application form

  9. How does incorporation affect CASC Status? • If you have CASC status already and decide to incorporate, you must register the new company as a CASC before the assets are transferred • If you decide that you want to apply for CASC status at the same time as incorporating you will need to use the template constitution for CASCs and apply for CASC status (taking care not to amend the CASC clauses) • HMRC’s CASC department are happy to look at draft constitutions and your most recent accounts as part of the application

  10. Contact details Serena Hedley-Dent Farrer & Co 66 Lincoln’s Inn Fields London WC2A 3LH 020 7917 7352 020 791 7293 shd@farrer.co.uk

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