Employee Ownership Trusts: Recent Legislative Changes

The UK Government proposes updates to legislation to tighten the Employee Ownership Trust tax regime and ensure EO remains viable and sustainable.

In response to the consultation (Taxation of Employee Ownership Trusts and Employee Benefit Trusts which ran from 18 July 2023 to 25 November 2023) the UK Government published it's summary of responses alongside the Autumn Budget 2024. You can read the full response and the draft legislation here.

The response sets out a series of legislative updates which are included in the draft Finance Bill 2024-2025, which is currently making its way through Parliament (on its second reading at the time of this article). Once the relevant changes go live, assuming there are no changes during the passage of the Finance Bill through Parliament, the amendments to the Employee Ownership tax regime will come into effect and, for the most part, will have effect from 30 October 2024 (so will look back slightly but are not intended to be