Employee Ownership Trusts (EOTs) offers an attractive form of succession strategy that could suit your business needs more than a management buyout or traditional trade sale.

What is an EOT?

Introduced in 2014, the transaction centres on the departing shareholders selling their shares in a company to a trust which then holds the shares on behalf of the company’s employees.

What are the benefits?

The nature of the EOT structure facilitates a smooth transition of ownership of the business, with usually little disruption to the day-to-day operations, as well as providing a highly tax-efficient succession plan for shareholders.

Providing the conditions set by HMRC are met, benefits can include:

  • The retention of the company’s core values and culture
  • Participation from employees in relation to the company’s future success
  • Heightened business performance from an increase in employee engagement
  • Potential employee rewards of annual income tax-free bonuses of up to £3,600 per employee

Get in touch

EOTs offer an attainable way to achieve employee engagement and retention by aligning company and employee interests. If you would like to discuss EOTs more in the context of your own business, get in touch with our team on 01788 539000 or 0116 261 0061.


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