The Employee Ownership Trust, (“EOT”), has become a very popular method for existing shareholders to exit their company. At this time when trade buyers have largely retreated from the marketplace, the EOT offers a seriously tax-efficient, commercially effective, and comparatively painless way to sell the company. The headline tax point: The capital gains tax on sale is zero and there is no exposure to income tax either. The sale proceeds, linked to the whole company value of the company, can be taken all in one payment if the company can afford or, alternatively, as a series of deferred consideration payments
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The Employee Ownership Trust and Other ESOP Exit Strategies
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