Many owners opt for a full 100% sale

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The UK government has provided significant tax relief to its employees to encourage them to transfer businesses. Under the EOT, majority shareholders can sell more than 50% of the share capital to a trust, receiving tax relief. The agreed sale price is based on a business valuation carried out by an independent expert. Without a third-party buyer, this price should reflect what the business could potentially pay over a reasonable period.

While some retain a minority stake in the company guatemala mobile database for various reasons - inheritance, ongoing income, passing on capital to loved ones as part of their personal estate, or to make the sale more affordable. For the business. It is important to understand that any subsequent disposal of shares retained in the EOT will not benefit from tax exemption. If a minority stake is retained, provision should be made to protect the interests of shareholders from events such as dilution.

In essence, an EOT acts as a trust, consisting of a settlor, trustees, and beneficiaries. You can learn more about the basics of a trust here .