Sale of an EOT-owned company: UK tax and practical issues, including CGT, trustee duties, beneficiary tracing and PAYE/NICs

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Practice notes

What is an employee ownership trust?

An employee ownership trust (EOT) is a type of employee benefit trust that meets defined statutory conditions within tax legislation. The Finance Act 2014 brought in specific tax advantages available to companies owned by an EOT and to individuals disposing of shares to an EOT. For general information on EOTs, including an outline of the key features and tax reliefs, see Practice Note: Employee ownership trusts. For a review of common pitfalls, and mistakes or misconceptions that can arise when creating or running an EOT, see Practice Note: Pitfalls of setting up and operating an employee ownership trust.

This Practice Note addresses selected tax and practical issues that may arise where the trustees of an EOT sell a company already owned by that EOT. For further detail on the considerations involved in an initial sale of a company to an EOT, see Practice Note: Sale of a business to an employee ownership trust.

Background—overview of the capital gains tax relief. Relief from capital gains tax (CGT) is available upon a disposal by a...

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Pete Miller , CTA (Fellow)

Jerroms Miller Specialist Tax

Pete is Head of Corporate Tax at Jerroms Miller Specialist Tax, a joint venture dedicated to offering expert advice to clients and to other advisers on all business and corporate tax issues. Jerroms Miller specialises in the taxation of corporate reconstructions and reorganisations, HMRC clearances, the transactions in securities rules, distributions, partnerships, Patent Box, disguised remuneration and the taxation of intangible assets. Pete has worked in tax since April 1988, when he joined the Inland Revenue and trained as an Inspector of Taxes. He worked in Birmingham and London with roles in both Policy and Technical Divisions, where he was the Inland Revenue’s expert on all matters relating to the distributions legislation. He then worked for 11 years in ‘Big 4’ firms and, from 2011 to 2022, Pete ran his own business, The Miller Partnership, , specialising in the taxation of corporate...

Web page updated on 21/05/2026

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