Home • Services • Corporate Finance • Employee Ownership Trusts

Corporate Finance

Employee Ownership Trusts

Unlock Generous Tax Benefits and Secure Your Business’s Future by Selling it to Your Employees

Employee Ownership Trusts

In today’s dynamic business landscape, entrepreneurs and business owners are constantly seeking innovative ways to ensure the longevity and success of their companies. One such method that is gaining tremendous popularity is the Employee Ownership Trust, commonly referred to as an EOT. This alternative exit structure is revolutionising the way businesses transition ownership while preserving their core values and culture.

What are Employee Ownership Trusts?

Employee Ownership Trusts (EOTs) are a dynamic and innovative way to drive employee engagement and business sustainability. Under an EOT, a majority of the company’s shares are placed into trust, held for the benefit of the employees, who effectively become the owners. This creates a strong sense of belonging and engagement, aligning the interests of the workforce with the long-term success of the company.

Why Choose Scrutton Bland for EOTs?

Our Expertise in EOTs

At Scrutton Bland, we specialise in Employee Ownership Trusts and understand the transformative impact they can have on your business. Our dedicated team of advisers are committed to guiding you through the intricacies of EOTs.

Here’s why we should be your partner in this journey:

Proven Track Record

Tailored Solutions

Comprehensive Support

In house Tax team

Proven Track Record

We have successfully helped numerous businesses implement EOTs, resulting in increased employee engagement, enhanced productivity, and sustainable growth.

Tailored Solutions

We understand that every business is unique. Our approach is always tailored to your specific needs, ensuring that the EOT aligns perfectly with your company’s goals and culture.

Comprehensive Support

Deciding to sell your business is a life changing decision, one that can take up a lot of your time, and it’s important that you can rely on your advisers to act in your best interests. Our dedicated team will spend time getting to know you and your business, and will be just an email or call away whenever you need them.

In house Tax team

Our in house Tax team will work alongside our Corporate Finance team to help take advantage of the two tax breaks that an EOT creates when it comes to selling the business free of Capital Gains Tax and annual bonuses for employees free of Income Tax, subject to the conditions being met.

Frequently Asked Questions (FAQ’s)

What is the primary benefit of an Employee Ownership Trust (EOT)?

The primary benefit of an EOT is the alignment of employee and business interests. Employees effectively become the owners, leading to increased engagement, higher productivity, and long-term sustainability.

Can any business implement an EOT?

While most businesses can implement an EOT, it is essential to assess your company’s specific circumstances. Our team of EOT experts can help determine if an EOT is the right choice for you.

How does an EOT impact the company’s leadership structure?

An EOT does not change the day-to-day management of the company. Existing leadership can continue to operate as usual while benefiting from increased employee engagement and ownership.

Are there tax advantages to implementing an EOT?

Yes, there are tax advantages associated with EOTs, such as Capital Gains Tax (CGT) relief on the sale proceeds. Our Tax team will help you navigate the tax implications and optimise your tax position, both personally and for the longer term plans of the business. There are also tax advantages for the employees of the business too. An EOT company can pay annual bonuses up to £3,600 to its employees free of income tax.

What is the first step in implementing an EOT for my business?

The first step in implementing an EOT for your business is to reach out to our dedicated EOT team for a free initial consultation. We will assess your business’s suitability for an EOT and guide you through the process from there, ensuring that you receive the personalised support and expertise needed to embark on this transformative journey.

Our Approach

Our approach to Employee Ownership Trusts is centred on your business’s unique needs and goals. Below we give an overview of the process:

Consultation

We begin with a thorough free of charge consultation, to understand you, your business, its culture, and objectives. It’s usually about an hour long, where we will ask you questions to really delve into your thoughts and wishes and to deal with any initial queries or concerns that you may have.

Tailored Strategy

Based on our conversations, we will talk to you about succession planning options. We will discuss whether an EOT is the best strategy for you and the business or if another option would be more suitable.

Implementation

We will then work closely with you and any other advisers involved to set up the EOT. We will guide you through the process and give you realistic timescales that you can expect at each stage.

Ongoing Support

We provide continuous support to manage the EOT effectively, making necessary adjustments as your business evolves. We can also be appointed as an independent trustee going forwards, playing a critical role, acting as the lynch pin, making sure that terms of the Trust Deed are appropriately adhered to. We undertake this role for a number of our EOT clients.

Meet the team

Luke Morris

Corporate Finance Partner

Luke is a Partner and leads our Corporate Finance team.

Paul Harris

Private Client Tax Partner

Paul is a Private Client Tax Partner focused on serving central East Anglia from our Bury St Edmunds office.

James Thurkettle

Corporate Finance Director

James works on business valuations, disposals and acquisitions, and specialises in US/UK GAAP conversion work in the education sector.

Tyler Hursey

Tax Adviser

Tyler works in our tax team in Colchester.

“We have been clients of Scrutton Bland for many years, so when it came to looking at the structure of our business, it was an obvious choice to reach out to the team. I am incredibly impressed with the services provided by Scrutton Bland in helping us establish our Employee Ownership Trust. From the very beginning, their team exhibited a deep understanding of the complexities involved and guided us with expertise and professionalism. Thanks to their efforts, our transition to employee ownership was seamless, and we are now reaping the benefits. I highly recommend Scrutton Bland to any business considering an EOT.”

Paul Orriss,
Joint Managing Director, Gipping Construction

“We would like to take this opportunity to thank the teams at Prettys and Scrutton Bland for all their hard work and expert advice that has allowed us to reach this point. We are particularly grateful to Luke Morris, Head of Corporate Finance and Partner at Scrutton Bland, who will now sit on the Trustee Board as our Independent Trustee. We very much look forward to the next chapter and thank all our staff, clients and suppliers, for their ongoing support.”

Jonathan Hudson,
Director, Haydn Evans Consulting

Get in touch for a free consultation

At Scrutton Bland, we are committed to being your trusted partner on this journey, providing expert guidance, tailored solutions, and the latest industry insights. Contact us today to explore how your company can transition into an Employee Ownership Trust (EOT) structure.

Need help? Contact one of our advisers