Rural Community Shops News

Each year, many community shops pay corporation tax -  a 20% tax on their taxable profits. However, it has come to light that community shops using the Industrial and Provident Society for the Benefit of the Community structure can be registered as dormant for Corporation Tax purposes.

The Plunkett Foundation confirmed this benefit for community shops with HMRC following Almondsbury Community Shop in Gloucestershire making a recent breakthrough.

The exemption can be made on the condition that the community shop is a not for profit business and that any profits made are not distributed to any indivuals including shareholders, members, staff etc. It is acceptable to use profits to pay the wages of staff, for instance, but not to issue dividends or bonuses to directors or owners (i.e. members).

To register your community shop as dormant from Corporation Tax, you will need to write to your local HMRC office enclosing copies of your Articles of Association or Model Rules, and explaining:

• that you are non-for-profit business
• that you have an IPS legal structure
• the purpose of your community shop
• what you do with your profit

If you need any further guidance on this, including contact names at the HMRC, please contact James Alcock at the Plunkett Foundation for further information.

AN ARTICLE IN THE DAILY TELEGRAPH FEATURING COMMUNITY SHOPS DEFYING GOVERNMENT CUTBACKS.

http://www.telegraph.co.uk/earth/countryside/7947538/With-no-help-from-the-Coaltion-country-folk-are-doing-it-for-themselves.html

Chill winds are blowing in the countryside, and they're nothing to do with the autumnal weather. For 13 years, activists have been telling the world that Labour had no sympathy for the rural population – indeed, viewed it, in some cases, with malevolence. Now they are realising that things weren't so bad after all.

The coalition victory has not brought them to a Promised Land. They have seen the glint of a spending axe and are waiting for it to fall. Far from being protected by the Conservatives and Lib Dems, the natural parties of the countryside, the rural world may find that the pain is even keener.

Rural organisations are turning purple in the face. Today, Lord Taylor of Goss Moor – who, as Matthew Taylor, sat as Lib Dem MP for Truro and St Austell – will articulate this rage on behalf of a coalition of six groups behind a report into the state of the countryside. Already, country people are having to travel further to buy groceries, post parcels or visit doctors, at a time when petrol prices are reaching stratospheric levels. Remove government support for rural bus services, for example, and much of the countryside will become "part dormitory, part theme park and part retirement home", says Lord Taylor, while young people trudge off to find cheaper homes on the outskirts of towns.

I would be the last person to deny that he has a point. The countryside is a special case. But the Treasury is besieged by special cases. Besides, some top Tories are profoundly unmoved by the litany of rural sorrows, pointing out that nobody has to live in the countryside, and perhaps country people have to make a sacrifice if they want to pursue an enviable way of life. I doubt that David Cameron, holidaying in Cornwall, will be among their number. But neither will he scatter gold.

Rural communities must find another way, and many are taking the future into their own hands. For example, many villages won't accept that shops must close. They are teaming up and running the show themselves. According to the Plunkett Foundation, which promotes a vision of rural self-reliance propounded more than 100 years ago by politician Sir Horace Plunkett, 241 community-owned village shops have opened in the past 25 years. Some operate on co‑operative principles, others are run according to strict business plans. Only five have failed.

Earlier this year, William Hague opened the George and Dragon community pub at Hudswell, North Yorkshire, owned by 160 shareholders, half of them living in the village. At Fintry, in Scotland, West Coast Energy were astonished when residents, often against wind turbines, asked if they would add another one to 14‑turbine wind farm; they wanted to operate it as a community resource. Some villages have laid fibre-optic cable for high speed broadband, on a business model that pays back after 25 years.

By such means, villages may yet overcome the woes that face them. It won't be easy, but country people are suited to the challenge. They have always helped each other out. With their tradition of putting on pantomimes in the village hall and doing shopping for neighbours, they ought to be flag carriers for the Big Society. They know all about volunteering. They also know about the regulations that have come to discourage them from doing it.

Cuts to budgets may be a painful necessity. Cuts to red tape and the compensation culture are devoutly to be wished.
 

Collyweston Community Shop in Northamptonshire has recently won two awards in the Northamptonshire 'Improving your Patch Awards'.  They won the East Northants District Award (£150) and the County Award (£400).  In addition to the two very welcome cheques, the shop was presented with three certificates and a carved oak plaque which is now on display in the shop.  The award money will go towards some new wooden shelving - together with the added discount that is available through the Plunkett Website on Gadsby Basketware.

This just goes to show the value of entering local and regional awards - it provides a much welcome cash incentive as well as demonstrating to your customers and members that your community shop is special!