Employee Ownership Trusts - Tax Aspects and Other Issues

• What is an EOT? (Employee Ownership Trust)
• When could an EOT company provide a suitable exit route for the owner?
• The 5 key qualifying conditions
• The 3 steps in creating an EOT
  • Example of how an EOT is created
• Appointing trustees of the EOT Finance
• Selling a partnership business to an EOT
• Financing the acquisition for the EOT
• Advantages of selling to an EOT for the vendors
  • Example scenario
• Seeking HMRC (Her Majesty's Revenue and Customs) clearance
• Advantages of an EOT for the employees
  • Example scenario
• Incentivising loyalty of the employees after the transfer
• Potential areas of concern
  • Example – unsuccessful performance after transfer
• Potential issues after the transfer for the vendors
  • Case study – different possible outcomes following the transfer
• Disqualifying events after the transfer and their tax consequences

Q&As

• The opportunity to raise examples you have come across and discuss the tax implications
• Regular pauses for questions on each topic covered to take questions and queries

The course trainer is a Director of a consultancy company specialising in taxation, share scheme advice, reward and lecturing. He has developed a specialised share scheme service for small companies and advises FTSE companies on communication. The lecturing covers most aspects of Direct Taxation but his particular interests include employment taxation and transfer pricing, which poses unusual conceptual challenges.

Previous to this he worked for Henderson for nearly 9 years, leading the Share Schemes team for part of this time.

The trainer took the level 7 CIPD Masters qualification whilst at Henderson. Before Henderson, he was with Australia Mutual Provident (AMP) and helped set up one of the first Share Incentive Plans (SIP) for large companies in 2001. It was so unusual at the time that the Revenue phoned Jeremy up to find out how they could encourage more large companies to adopt SIP.

He started his career in taxation and for the following 16 years worked in three of the “Big Four” accountancy firms. He ended up as a Senior Manager with Deloitte & Touche, having worked on issues such as profit-related pay, share schemes, expatriate tax, tax investigations, reward management, US taxation, transfer pricing and corporate tax.

• Identify when a transfer to an EOT could provide a suitable exit route for the owners
• Understand the steps required to create an employee ownership trust
• Discuss the tax advantages for the transferor
• Analyse the tax advantages for the employees
• Understand the potential drawbacks of the arrangement for both the former owner and the employees

• The employee ownership trusts training is highly practical and will include multiple examples to assist with understanding the Employee Ownership Trust rules.
• It is presented by an independent training professional and can be a completely independent look at the issues raised.
• The employee ownership trust webinar will encourage participation and allow for all questions and clarifications to be considered.
• The course will always be completely current and relevant.

This employee ownership trust webinar course is designed to help attendees appreciate the attractiveness of employee ownership trusts as a possible exit route for an entrepreneur.
The suitability of this route will be explained if other exit routes such as a third-party sale or a transfer to family members are deemed to be inappropriate.
It will discuss the tax advantages for both the transferors and the employees of the company as well as any potential drawbacks for each.
We will be using examples to apply the rules in practice so that delegates have a full understanding of the tax consequences for each of the parties involved.