Employee benefit trusts overview and administration

Produced by Tolley in association with Karen Cooper of CooperCavendish LLP
Employment Tax
Guidance

Employee benefit trusts overview and administration

Produced by Tolley in association with Karen Cooper of CooperCavendish LLP
Employment Tax
Guidance
imgtext

Background

Employee trusts are commonly used to support employee share schemes but can also be used as part of an arrangement companies put in place to pay cash bonuses or other benefits. There are many different names for them, including employee share ownership plans (ESOPs), employee share trusts (ESOTs) and employee benefit trusts (EBTs), but they all fundamentally serve the same purpose as discretionary trusts set up by a company or group of companies as part of its remuneration strategy for employees.

An EBT will be established by a company (the sponsoring company) which will provide it with assets (usually cash or shares). An EBT will often be funded by way of loan or the company may make it an outright gift. The document governing how the EBT operates is called the trust deed and rules. This lays down the obligations of the sponsoring company and contains the powers and duties of the trustees. The trustees must act in accordance with the terms of the trust deed and rules and also

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™
Karen Cooper
Karen Cooper linkedinicon

Partner at CooperCavendish LLP


Karen is an experienced employee benefits lawyer with more than 20 years' experience in advising companies of all sizes in relation to their employee benefit and remuneration issues. She trained and worked for leading law firms Baker McKenzie LLP and Linklaters LLP and spent three years as a remuneration consultant at Ernst & Young LLP. Prior to co-founding Cooper Cavendish, Karen headed up Osborne Clarke LLP's employee benefit practice for 15 years.Karen is a thought-leader and regularly speaks and presents at industry conferences and events. She is a member of the Small Quoted Companies Alliance Share Scheme Committee and the Share Plan Lawyers Organisation. Karen is also the author of a wide range of legal publications including the chapter on executive remuneration in Sweet & Maxwell's 'Corporate Governance', the chapter on employee share schemes in Jordan's Company Administration and she contributes regularly to Tax Journal, and Practical Law (PLC). She is ranked as a leading individual on employees share schemes in Chambers and Partners and was recognised in the 2015 International Tax Review Women in Tax Leaders (a comprehensive guide to the world's leading female tax advisers).

Powered by Tolley+

Popular Articles

Loans provided to employees

Loans provided to employeesEmployers sometimes provide their employees with loans, sometimes charging interest and often not, either as part of the reward package or to help the individual meet significant expenditure. For example, it is common to provide loans for the purchase of annual travel

14 Jul 2020 12:11 | Produced by Tolley Read more Read more

Foreign exchange issues

Foreign exchange issuesOverview of foreign exchange provisionsForeign exchange (FX) movements are generally taxed following the rules applicable to the underlying income, expenditure, asset or liability on which they arise, broadly as follows:Capital assetsOn a realisation basis (ie on disposal)

14 Jul 2020 11:44 | Produced by Tolley Read more Read more

Corporate interest restriction ― administrative aspects

Corporate interest restriction ― administrative aspectsThe corporate interest restriction (CIR) regime has some specific administrative rules in addition to the general administrative requirements for corporation tax returns. This guidance note does not include commentary on provisions that are

14 Jul 2020 11:19 | Produced by Tolley Read more Read more