Employee Ownership Trust (EOT)
Herrington Carmichael have a specialised team who have represented many clients in various EOT transactions.
The implementation of an EOT involves the transfer of shares in a trading company, from the original owners, to a trust. The trust then holds the shares on behalf of the employees of the company.
Managing Partner, Yavan Brar, leads the EOT team and works closely with Sophie Protheroe.
We are able to advise on all stages of the EOT process, including:
- providing initial guidance on whether the relief requirements as set out in s236H(4) TCGA 1992 are likely to be satisfied to allow CGT relief to be obtained;
- preparation of the HMRC clearance letter;
- management of the due diligence process;
- assisting in the explanation of the EOT process to employees;
- advising on the trust composition;
- drafting and negotiating transaction documents; and
- advising on post-completion requirements.
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Case Study: Streamlining Operations
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John Doe
24 May 2023
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5 min read
Analysis
Case Study: Streamlining Operations
Learn how we improved efficiency our client
John Doe
24 May 2023
.
5 min read
Analysis
Case Study: Streamlining Operations
Learn how we improved efficiency our client
John Doe
24 May 2023
.
5 min read
Analysis
Case Study: Streamlining Operations
Learn how we improved efficiency our client
John Doe
24 May 2023
.
5 min read
Analysis
Case Study: Streamlining Operations
Learn how we improved efficiency our client
John Doe
24 May 2023
.
5 min read
Analysis
Case Study: Streamlining Operations
Learn how we improved efficiency our client
John Doe
24 May 2023
.
5 min read
Advising Hawkins Group on transition to an Employee Ownership Trust
The Herrington Carmichael corporate team advised the founders of the Hawkins Group of Companies, a construction group, on the sale…
Herrington Carmichael Advise KGB Cleaning South West Limited on the sale of the entire issued share capital to an EOT
Herrington Carmichael advised the shareholders on the sale of the entire issued share capital of the company to an EOT.
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Frequently Asked Questions
Find answers to your most pressing questions about our services and processes.
Why set up an EOT?
There are many benefits to setting up an EOT, the most common of which include:
- The selling shareholders can release their equity and realise their assets.
- There are numerous tax advantages to both the selling shareholders and the employees for complying with the EOT regulations.
- Creation of employee ownership culture.
- Motivation for current employees and increased retention.
How to set up an EOT?
If you are a shareholder or a group of shareholders considering exiting, we can help you explore whether an EOT is the best option and the next steps to take to implement. If you want to discuss further, please contact Sophie Protheroe in our Corporate team.
Who should be trustees of the EOT?
Provided the sellers do not control the trust, there are no rules about who can be a trustee. We would recommend there is at least one professional trustee alongside members of the management team.
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