Employee Ownership Trust (EOT) Tax Relief Check

Why this matters

Selling a controlling interest in a trading company to an Employee Ownership Trust (EOT) can qualify for Capital Gains Tax relief under section 236H of the Taxation of Chargeable Gains Act 1992. The rules have tightened recently: Finance Act 2024 added requirements on trustee independence, trustee control and the value paid, and the Autumn Budget 2025 reduced the relief to 50% for disposals made on or after 26 November 2025. Sellers, directors and advisers should confirm which rules apply to their transaction date.

The conditions do not end at completion. The company must remain a trading company, the trust must keep a controlling interest, and benefits must be offered to all eligible employees on equal terms. A disqualifying event during the clawback period can bring the original gain back into charge and create a significant unexpected tax bill. Companies also need to meet reporting and record-keeping obligations to HMRC, so early planning matters.

What you'll need

• The date of the sale (or planned sale) to the trust
• Details of the trust's trustees and how they were appointed
• The share structure and percentage held by the trust and former owners
• How the company currently shares profits and benefits with employees

What you'll get

A personalised compliance report covering: a score out of 100, an executive summary, a list of findings ranked by severity, and a prioritised action plan with timeframes.