Ever pondered how to exit your business with minimum fuss, while reaping maximum rewards and securing its future?
That's the power of an Employee Ownership Trust (EOT). You pull value from your business, tax-efficiently, whilst improving staff engagement, loyalty and productivity.
At Loucas we've steered numerous businesses, just like yours, through their lifecycle from start to exit. An EOT is a powerful tool in our arsenal
Many forward thinking companies are taking this path because EOTs offer a seamless transition of ownership to your employees, turning them into stakeholders invested in your business's success.
It's not just smart, it's strategically advantageous.
Employee ownership trusts are a method of ownership where the company’s employees hold a controlling state via a trust.
An EOT is a very tax efficient way to sell your business. So long as the EOT acquires more than 50% of the shares then you will pay zero capital gains tax.
The reasons you choose to create an EOT scheme are personal. It could be to pay less tax on your business sale or it could be to ensure continuity in the business for the employees and customers.
Whilst the UK government has encouraged EOT’s since 2014, employee ownership is a well established model. For example, the trust created by John Lewis Partnership was created in 1929.
The popularity of EOT's is rapidly increasing. In June 2022 the total number in the UK reached 1,030. As well as offering a smooth succession plan for busines owners, the performance of employee owned businesses is highly attractive.
You pay zero capital gains tax.
You are guaranteed full market value for your shares.
Takes less time and less likely to fall through than selling to a 3rd party .
Your competitors will not know you are selling the business.
Allows you to retire with satisfaction that ownership has passed onto the people who helped build the business.
Avoids uncertainty in staff, suppliers and clients that often impacts businesses under new ownership.
Supports existing strategy, investment and business structure.
The culture and growth of the business is fuelled by greater commitment and productivity from employees.
Are able to receive tax-free annual bonuses of up to £3,600.
Are able to have a say in how the business is run and operated.
Feel rewarded for their hard work in growing the business.
Encourages loyalty, decreases sick leave and increases productivity.
The increasing popularity and performance of companies who create an employee ownership trust suggests there really aren't many downsides. Like any change to your business though, the companies goals and the owners personal objectives need to be considered.
For the business owner looking to exit the business, setting up an EOT will result in payments being made over time by the trust. You wont get an immediate one lump sum and you need to be confident of the companies continued success so that they can make further payments.
When turning ownership over to the EOT you also need to be certain that the people in the business want to take shared ownership. Is there a motivated leadership team that is excited by the plans? Do the lower ranked staff have any interest in the scheme? The current owners and leadership team will need to have these conversations, promote the EOT plans and take the company through the process.
For modern thinking companies who want to empower their staff an EOT is an exciting succession plan and step forward for the business. When you talk to Loucas about creating an EOT we will guide you through the process and benefits to ensure it is a good fit for you and your business.
The popularity of EOT's is rapidly increasing. In June 2022 the total number in the UK reached 1,030. As well as offering a smooth succession plan for busines owners, the performance of employee owned businesses is highly attractive.
Takes less time and less likely to fall through than selling to a 3rd party .
You pay zero capital gains tax.
You are guaranteed full market value for your shares.
Your competitors will not know you are selling the business.
Allows you to retire with satisfaction that ownership as passed onto the people who helped build the business.
Avoids uncertainty in staff, suppliers and clients that often impacts businesses under new ownership.
Supports existing strategy, investment and business structure.
The culture and growth of the business is fueled by greater commitment and productivity from employees.
Are able to have a say in how the business is run and operated.
Are able to receive tax-free annual bonuses of up to £3,600.
Feel rewarded for their hard work in growing the business.
The increasing popularity and performance of companies who create an employee ownership trust suggests there really aren't many downsides. Like any change to your business though, the companies goals and the current owners personal objectives need to be considered.
For the business owner looking to exit the business, setting up an EOT will result in payments being made over time by the trust. You wont get an immediate one lump sum and you need to be confident of the companies continued success so that they can make further payments.
When turning ownership over to the EOT you also need to be certain that the people in the business want to take shared ownership. Is there a motivated leadership team that is excited by the plans? Do the lower ranked staff have any interest in the scheme? The current owners and leadership team will need to have these conversations, promote the EOT plans and take the company through the process.
For modern thinking companies who want to empower their staff an EOT is an exciting succession plan and step forward for the business. When you talk to Loucas about creating an EOT we will guide you through the process and benefits to ensure it is a good fit for you and your business.
Below are just some of the thousands of happy customers Loucas have helped since 1974.
After many years working with different kind of accountants offices over Europe, Loucas by far the best service I've ever dream of!
The team are so professional, handling every single detail without giving any burden on client shoulders, very responsive via email or calls & mostly they have very advanced/up to date systems to keep track & issue reports which made all my business life smooth & easy.
I highly and always recommend their firm to others. Keep the great work then. Thank you so much for all your support.
I have been using Loucas for the last 16 months for both my business and personal accounts.
I cannot recommend them highly enough to anyone who is looking for an accountant.
They are extremely knowledgeable, helpful and professional. As a new business owner, they have been very patient in guiding me through what is required for me to do and are always a phone call away if I have any questions.
One of the best decisions we have made in our fledgling business was to pick Loucas as our accountants.
We've had a great experience using Loucas over the years for the business I work in.
They are knowledgeable, reliable and prompt at helping with everything we need, always! The payroll department have been second to none and we'd highly recommend their services.
Loucas have been my accountants for around 20 years, which should be testament enough to how good I find them.
Their professionalism and service is second to none and they always manage to communicate clearly and simply.
Highly recommended.
Really good accountants, especially the payroll ladies who are always very friendly and helpful and nothing is too much trouble for them.
I have been delighted with the proactive, professional, prompt and friendly service provided by Loucas.
I have enjoyed working with all the team members.
Excellent value for money as well.
© 2023 Loucas. All rights reserved. Site map | Accessibility | Disclaimer | Help
We use cookies on this website, you can find more information about cookies here.