EOT 101: Your Essential Guide to Employee Ownership Trusts

An Employee Ownership Trust (EOT) is a structure that allows business owners to sell their company to a trust established for the benefit of the employees. It offers tax advantages, preserves the company’s culture, and aligns employee interests with business success. For the owner, it provides a fair market exit and the assurance that the company will be stewarded by those who understand it best—the employees.

Find out if an EOT is right for your business at EOT.co.uk/contact.

EOTs were introduced in 2014 as part of the Finance Act to encourage wider employee ownership. The UK government recognised the benefits of employee ownership in fostering productivity, resilience, and employee well-being, making it an attractive succession option for business owners.

Contact us at EOT.co.uk/contact to learn how this structure can benefit your business.

EOTs were established to provide an alternative to traditional business sales, such as trade sales or private equity buyouts. They aim to enhance employee engagement, preserve jobs, and ensure the long-term sustainability of businesses. For business owners, they provide a means to exit with peace of mind, knowing their legacy is secure, and they are rewarded fairly for their years of work.

Speak with an expert about the benefits of an EOT at EOT.co.uk/contact.

EOTs are governed by UK trust and tax laws. They must meet specific conditions set out by HMRC to qualify for tax reliefs and other benefits. Trustees oversee the operation of the trust, ensuring it works in the best interests of the employees.

Get advice on legal compliance for EOTs at EOT.co.uk/contact.

Most private companies, regardless of sector, can transition to an EOT, provided they meet qualifying criteria such as profitability and stability. EOTs work well for businesses with strong leadership teams, recurring revenue, and engaged employees.

Discover if your business qualifies for an EOT by contacting us at EOT.co.uk/contact.

Yes, EOTs can be adapted for businesses in various sectors, including manufacturing, professional services, retail, and more. The suitability depends more on the company’s financial health and operational structure than its industry.

Speak with an adviser to assess if an EOT suits your sector at EOT.co.uk/contact.