Employee ownership trusts

Any form of succession planning requires careful consideration and advice from specialists. Employee Ownership Trusts are increasing in popularity as a tax efficient method to enable owners to retire from their business and ensure the business is in good hands for the future.

EOTs involve the transfer of a controlling share in a trading company to a trust that holds the shares on behalf of the employees of the trading company. There are a number of conditions to be met and maintained in order to retain the tax benefits that accompany such schemes; good advice and documentation will ensure the necessary compliance and avoid the traps for the unwary.

A number of the lawyers in our Corporate Team specialise in advising company shareholders in relation to EOTs, helping you navigate the complexities of the legislation and providing pragmatic and practical advice to:

• Help you understand if an EOT is right for your business
• Prepare and advise you on the documentation required to create an EOT 
• Guide you on the practicalities of the ongoing EOT arrangements

We also advise:

• EOT directors and trustees, helping them to understand their rights and responsibilities in connection with the EOT
• EOTs – assisting them to ensure they satisfy the conditions and legal requirements and avoid disqualifying events

Our team regularly advises on EOTs, dealing with 4 in the last 12 months alone as their popularity increases, and are ready to guide you.