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Trusting types: how to set up an EOT


OneState Ltd is a company specialising in aeronautical design and which employs 150 people most of whom are engineers or designers. The company is owned in equal shares by its three founders who are now contemplating retirement and looking at their options. One possibility that they are actively considering is a sale of the company to an employee ownership trust (EOT) which would allow the existing management team to take the company forward while giving the founders access to an exemption from CGT. What are the practicalities around setting up an EOT?


The rules on EOTs were enacted in FA 2013 and can be found in TCGA 1992 ss 236H–236U. They provide an attractive tax regime for entrepreneurs who wish to exit and are not willing or ...

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