Employee Ownership Trusts (EOTs)
Level provides comprehensive support for business owners considering an Employee Ownership Trust (EOT) transition.
With one of the UK's most experienced EOT specialists, Robin Hartley, leading our practice, we offer practical, commercial guidance through every stage of the process, providing tailored strategies to navigate the complexities of employee ownership.
Our broad range of experts across corporate, commercial, employment and other legal disciplines enables us to offer seamless service at every stage.
What is an Employee Ownership Trust?
An EOT is a government-supported structure that enables business owners to sell their company to their employees through a trust arrangement. Introduced by the Finance Act 2014, EOTs provide significant tax advantages while creating a sustainable ownership model that preserves company culture and values.
Why choose Level for your EOT transition?
Our EOT practice is led by Robin Hartley, who brings 16 years of employee ownership expertise and has advised on EOT transactions with a combined value exceeding £500 million. Robin's unique background spanning Magic Circle, Big-4 accountancy, and leading City law firms equips him to provide holistic advice that considers all aspects of your transition to employee ownership.
Our EOT Services: We provide end-to-end support for your EOT journey
Initial Assessment and Planning
- Detailed feasibility analysis
- Financial modelling and structuring advice
- Comparative analysis with alternative exit options
- Strategic planning for implementation
Transaction Support
- Company valuation guidance
- Documentation preparation and review
- Tax planning and clearances
- Regulatory compliance and approvals
- Financing structure optimisation
- Implementation support
Post-Transaction
- Employee communication strategies
- Governance structure setup
- Ongoing compliance support
- Additional incentive scheme design
Benefits of an EOT
For Business Owners
- 100% capital gains tax relief on qualifying sales
- Fair market value for selling shareholders
- Legacy preservation
- Controlled transition process
- Lower transaction costs
- Reduced complexity compared to trade sales
- No requirement for external buyer negotiations
For the Business
- Preservation of independence
- Protection of company culture and values
- Enhanced employee engagement
- Improved business resilience
- Potential for increased productivity
- Sustainable ownership structure
For Employees
- Annual tax-free bonuses up to £3,600
- Increased job security
- Enhanced engagement and motivation
- No personal investment required
Why Choose Level?
Our EOT practice combines deep technical expertise with practical commercial understanding. We pride ourselves on:
- Clear, straightforward advice
- Commercial focus
- Collaborative approach
- End-to-end support
- Proven track record
Our Approach
We understand that transitioning to employee ownership is about more than just tax benefits. We believe that the best legal advice combines technical excellence with commercial awareness and human understanding. Our approach to employee ownership transitions reflects this philosophy:
- Listening First: We begin by understanding your business, its values, and your objectives for the transition.
- Comprehensive Analysis: We conduct thorough assessments of financial, legal, and structural considerations to determine the most appropriate path forward.
- Bespoke Solutions: We develop tailored strategies that balance the interests of all stakeholders involved in the transition.
- Clear Communication: We explain complex legal and financial concepts in straightforward terms, ensuring you can make informed decisions with confidence.
- Ongoing Support: Our relationship doesn’t end with the transaction; we provide continued guidance as your business evolves under employee ownership.
Feasibility & Planning
Before committing to an EOT transition, it’s essential to understand whether this route is right for your business:
- EOT Suitability Assessment – Evaluation of your business against key qualifying criteria, including trading status, ownership structure, and employee profile
- Comparative Exit Analysis – Objective comparison of EOT transitions with alternative exit routes such as trade sales or management buyouts
- Initial Financial Modelling – Preliminary analysis of transaction viability, consideration structure, and post-transaction business sustainability
- Tax Qualification Review – Assessment of eligibility for 0% Capital Gains Tax relief and identification of potential compliance issues
- Timeline Development – Creation of a realistic implementation plan with key milestones and decision points
Transaction Structuring & Implementation
Once you decide to proceed with an EOT, our experienced team handles all aspects of transaction design and implementation:
- EOT Design – Creation of trust structures that meet statutory requirements while addressing your specific business needs
- Financial Structure Development – Comprehensive financial modelling to balance seller reward, business stability, and employee benefits
- Transaction Documentation – Preparation of all legal documentation required for the EOT transaction
- Trustee Selection and Training – Guidance on trustee appointment and governance structures that comply with the latest regulatory requirements
- HMRC Engagement – Management of clearance applications and negotiation with tax authorities
- Completion Management – Coordination of all parties to ensure smooth transaction execution
- Regulatory Approvals – Navigation of sector-specific regulatory requirements for regulated businesses
Key contacts
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