The Future of EOTs: Less Tax Relief, Still Strong Potential
Hugo Persad, Trainee Solicitor in our Corporate Team, summarises the impact of reduced Capital Gains Tax (“CGT”) relief on sales to Employee Ownership Trusts (“EOTs”) following the Autumn Budget.
The Autumn Budget on 26 November 2025 introduced a number of new considerations for business owners. A major and unexpected change was the reduced Capital Gains Tax (“CGT”) relief on sales to Employee Ownership Trusts (“EOTs”).
Since the introduction of EOTs over a decade ago through the Finance Act 2014, EOTs have become an attractive route for business owners seeking to exit and also considering succession planning. One desirable appeal of EOTs was the 100% relief on CGT making it a beneficial and tax-efficient mechanism for an exit strategy. This made EOTs a desirable option for business owners who wanted to take a step back while also ensuring their business preserves its independence, culture, direction and allows for the business to remain in trusted hands.
While the Autumn Budget reduced the CGT relief available, it did not affect the core principles of selling to an EOT, and it is worth remembering that an EOT may still be a viable option for exit. A sale to an EOT can be significantly more streamlined than a traditional sale to a third party and there may still be many other commercial factors that could make an EOT the right fit. Likewise, there are instances where an EOT will not be appropriate. EOTs are still relatively tax efficient, so while the CGT relief is reduced, business owners will still benefit from an overall lower rate in comparison to that applicable on a third-party sale.
The sale to an EOT is still an attractive option for owners looking to make an exit, albeit the tax landscape is now slightly more equal. Importantly, it is not the only viable option. Business owners still have a range of exit strategies available to them each offering different advantages depending on their objectives, financial position and desired legacy.
To understand more about Employee Ownership Trust, or other exit strategies for your business going forward, please contact our Corporate Team by email at info@leathesprior.co.uk or by telephone at 01603 610911.
Autumn Budget 2025: Agricultural Property Relief & Business Property Relief Changes
It was announced in the 2025 Budget that from 6 April 2026, changes will be made to agricultural property relief and business property relief. These changes bring APR and BPR in line with the nil-rate band rules, meaning unused allowances can be transferred to a surviving spouse or civil partner. This is a significant step towards making estate planning easier for families who own farms or businesses.
The Employment Rights Act 2025 is expected to come into force tomorrow (18 December 2025)
After an extended period of back-and-forth amendments between Parliament and the House of Lords, on 16 December 2025, the ERB finally received approval from the House of Lords, with the formality of Royal Assent due to take place tomorrow (18 December 2025). Head of LP Employment, Dan Chapman, explains...
Charity of the Month: The Matthew Project
Leathes Prior is delighted to be supporting The Matthew Project as our Charity of the Month for December 2025. The Matthew Project supports young people and adults across Norfolk, Suffolk, and Essex to overcome issues around drugs, alcohol, and mental health, empowering them to rebuild confidence and lead fulfilling lives.
Autumn Budget 2025: Agricultural Property Relief & Business Property Relief Changes
It was announced in the 2025 Budget that from 6 April 2026, changes will be made to agricultural property relief and business property relief. These changes bring APR and BPR in line with the nil-rate band rules, meaning unused allowances can be transferred to a surviving spouse or civil partner. This is a significant step towards making estate planning easier for families who own farms or businesses.
The Employment Rights Act 2025 is expected to come into force tomorrow (18 December 2025)
After an extended period of back-and-forth amendments between Parliament and the House of Lords, on 16 December 2025, the ERB finally received approval from the House of Lords, with the formality of Royal Assent due to take place tomorrow (18 December 2025). Head of LP Employment, Dan Chapman, explains...
Charity of the Month: The Matthew Project
Leathes Prior is delighted to be supporting The Matthew Project as our Charity of the Month for December 2025. The Matthew Project supports young people and adults across Norfolk, Suffolk, and Essex to overcome issues around drugs, alcohol, and mental health, empowering them to rebuild confidence and lead fulfilling lives.
Leathes Prior’s Milan Pandit appointed President of the Norfolk & Norwich Law Society
Leathes Prior Solicitors is proud to announce that Milan Pandit, Solicitor in our Corporate & Commercial Team, has been appointed President of the Norfolk & Norwich Law Society (NNLS) for 2025/26.
Commercial Lease Renewals: A guide for Landlords & Tenants
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Our Guidance, Your Legacy: What is a Will, and why should I make one?
Not only is a Will one of the most important steps you can take to protect your loved ones and ensure your wishes are respected, but it also limits the likelihood of a claim/dispute following your death. To ensure your loved ones and the causes you care about benefit from your estate, a Will is essential to ensuring this happens. Find out more in this article.
Lease extensions: The essentials to getting started
Extending your lease can seem complex, but taking the right steps early can make the process much smoother. Jake Mowatt, Associate and Harry Smith, Trainee Solicitor in our Residential Property Team outlines the key essentials every leaseholder should understand prior to extending their lease.
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Service Charges in Residential Leases: FAQs
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Leathes Prior winners in nine categories in the prestigious Legal 500 Future Laywer Survey
We are thrilled to announce that the firm has placed once again in the Legal 500 Future Lawyer survey as No.1 in the UK for our Social Life; a ranking we have held in the survey for seven years out of the past nine years.
Jess’s Rule – New Guidelines for GPs
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Leathes Prior are excited to announce that four Trainee Solicitors qualify at the firm
Leathes Prior is excited to announce that four of our amazing trainees, Eleanor Chapman, Maggie Berry, Alex Robinson, and Georgia Sartin, have successfully completed their training contracts and are now qualifying as Solicitors at the firm.
