Edition 1st
Published January 2022
Length 250pp est.
Suitable for Accountants, Tax Advisers
Price 85
ISBN 9781912386529

Employee-Ownership Trusts


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Since legislation was introduced in 2014, there has been a consistent growth in the number of company sales to employee-ownership trusts (EOTs). 

Accountants need to understand the different aspects of establishing a suitable trust, including satisfying the tax requirements to obtain CGT exemption and putting in place suitable corporate governance arrangements to ensure that the vendors are paid in full and that the business continues to prosper as an EOT-owned company.

This new volume brings together the technical and practical aspects, offering a vital guide for professional advisers in this field. 

The author, David Pett, is a tax barrister at Temple Tax Chambers in London. Read more here.

Background to EOTs
  • Introduction and background
The tax incentive for selling to an EOT
  • The relief from CGT
  • Trustees
  • The trust deed and other documentation
  • Balancing the interests: vendors, trustees, management, employees, other shareholders
  • Selling shares to the EOT
  • Funding the trustees
  • Gifts of shares to the trustees
  • An EOT as a discretionary settlement - other IHT issues
After the company has been acquired by the EOT
  • Tax-free bonuses for employees
  • Putting shares into the hands of employees
  • Distributing profit to employees
  • Disqualifying events and the consequences
  • Disposals of shares by the EOT trustees
Looking forward
  • Encouraging a move to EOT ownership