Choosing accounting software for a Community Interest Company (CIC) is more complicated than for an ordinary limited company, largely because CIC accounts cannot be filed directly through most third-party accounting software. Companies House requires CICs to submit a specific “package accounts” file, which includes the CIC34 community interest report, and this must go through Companies House WebFiling rather than being uploaded from a general accounting platform. Understanding this filing quirk before choosing software prevents a common and frustrating surprise late in the accounting process.
With over 26,000 CICs now operating across the UK, a rapidly growing structure for social enterprises, many directors moving from a standard limited company or sole trader background are choosing accounting software without realising CICs have distinct filing requirements. This guide covers what makes CIC accounting software different, how the filing process actually works, and what to look for when choosing a platform.
What Makes CIC Accounting Different
- Dual regulatory reporting: CICs must file annual accounts with Companies House and a separate CIC34 community interest report with the CIC Regulator, evidencing how the company benefited the community that year.
- The asset lock: Profits and assets must remain committed to the CIC’s community purpose, which affects how dividends, transfers, and asset disposals need to be tracked and reported.
- Capped dividend and interest payments: Unlike an ordinary limited company, a CIC limited by shares faces statutory caps on dividend payments, which accounting software needs to help track correctly.
- Corporation Tax still applies: Unlike a registered charity, a CIC pays Corporation Tax on its taxable profits, so standard company tax filing obligations remain in place alongside the CIC-specific reporting.
How CIC Accounts Filing Actually Works
| Step | What It Involves |
|---|---|
| Prepare accounts | Standard accounting software can be used to prepare the underlying financial accounts |
| Generate package accounts | Accounts must be converted into a specific package accounts file format including the CIC34 report |
| File with Companies House | Package accounts must be submitted via Companies House WebFiling directly, not through third-party software |
| File Corporation Tax return | CT600 and computations can typically be filed through standard tax software, separately from the accounts filing |
This split process, where day to day bookkeeping happens in one system but the final accounts filing happens through a completely separate government portal, is the single most common point of confusion for CICs choosing software, and worth understanding clearly before committing to a platform.
What to Look For in Accounting Software for a CIC
- Clear fund and asset tracking: Software that makes it easy to demonstrate the asset lock and track how funds have been used for community benefit simplifies preparing the CIC34 report each year.
- Compatibility with accounts production tools that support package accounts. Some accounts production software, distinct from everyday bookkeeping platforms, can generate the specific package accounts format Companies House requires.
- Dividend and interest cap tracking. For CICs limited by shares, software that flags dividend payments against the statutory cap avoids an easy compliance mistake.
- Support for Corporation Tax filing. Since CICs remain liable for Corporation Tax, confirm the software or accountant can handle CT600 filing alongside the CIC-specific accounts process.
- Sector-specific accountant familiarity. Given how specific CIC reporting is, working with an accountant or bookkeeper experienced with CICs specifically is often more valuable than the software choice alone.
Expert Insight
Accountants who specialise in CIC reporting consistently note that the biggest software-related mistake new CIC directors make is assuming their existing limited company accounting software will handle the full filing process end to end, only to discover late in the year that package accounts must go through Companies House WebFiling separately. Confirming this filing pathway before the first year end, rather than after, avoids a stressful last-minute scramble.
Frequently Asked Questions
Can I file CIC accounts directly through Xero, QuickBooks, or similar software?
No, day to day bookkeeping can be done in these platforms, but the final package accounts, including the CIC34 report, must be filed through Companies House WebFiling directly, not uploaded from third-party software.
What is a CIC34 report?
It is the community interest report CICs must file annually alongside their accounts, explaining how the company’s activities benefited the community during that financial year.
Do CICs pay Corporation Tax like a normal limited company?
Yes, CICs are liable for Corporation Tax on taxable profits, unlike registered charities which benefit from broader tax exemptions.
Is a CIC limited by shares or limited by guarantee taxed differently?
Corporation Tax treatment is broadly similar for both structures, though a CIC limited by shares has the added complexity of the statutory dividend cap, which guarantee structures do not need to track.
Do I need a specialist CIC accountant, or is standard accounting software enough?
Standard software handles day to day bookkeeping well, but given the dual filing requirement and asset lock reporting, many CICs find an accountant with specific CIC experience valuable, at least for the annual accounts and CIC34 preparation.
Final Thoughts
Accounting software for a CIC needs to be chosen with the dual filing requirement in mind from the outset, since the split between everyday bookkeeping software and the separate Companies House package accounts process catches many new CIC directors by surprise. Getting this right from year one avoids a difficult scramble at the first annual filing deadline. For related reading on choosing accounting software more broadly, see our guide to industry specific accounting software, and our guide to Making Tax Digital for Income Tax for related HMRC digital reporting changes.
For official guidance on CIC accounts filing, see the Regulator of Community Interest Companies on GOV.UK.
