Employee Ownership Trusts
Selling your business to an Employee Ownership Trust offers a powerful, tax-efficient succession strategy. It allows you to unlock value while rewarding your employees and preserving your company’s legacy. Our experts provide end-to-end guidance to ensure a seamless and compliant transition.
What Is an EOT?
An EOT is a legal trust that holds a controlling interest (51% or more) in a company on behalf of its employees. It encourages long-term business stability, enhances employee engagement, and safeguards the company’s culture and mission.
EOT Relief now 50% (effective 26 Nov 2025) = 12% CGT rate on all gains
Still substantially better than traditional sale routes!
Why EOTs Still Win: The 12% flat rate beats BADR on gains over £1m (where 3rd party sales pay 24%). Plus you get all the non-tax benefits below!
✓ Beyond Tax: Additional EOT Advantages
- Tax-free employee bonuses: Up to £3,600 per employee annually (unchanged)
- Maintain involvement: Continue as director with market salary after sale
- Flexible payment terms: Deferred consideration paid from company profits over time
- Enhanced performance: Employee-owned businesses show higher productivity & engagement
- Preserve your legacy: Keep business independent & in trusted hands
- Simplified sale: No need to find external buyer or navigate complex negotiations
- Employee wealth creation: Staff share in the value they help create
EOTs remain the most tax-efficient ownership succession route available
Example: On a £2m sale, an EOT saves you £240,000 vs a traditional sale (Apr 2026 rates). That’s a 13.6% better net return, plus all the strategic benefits of employee ownership.
