The legal and tax landscape for the ownership of shares by or for employees has changed significantly over the last two years. All tax practitioners should be aware of these developments, particularly in relation to the recognition of employee ownership as a freestanding business model. A major development is the introduction of a new type of employee trust, the employee ownership trust, as a capital gains tax exempt business succession solution. From 1 October 2014, there will also be an income tax exemption on certain bonuses paid to employees of a company (or group) where an employee ownership trust has a controlling interest.
