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

Wholly and exclusively

Wholly and exclusivelyFor both income tax and corporation tax purposes, one of the fundamental conditions that must be satisfied for an item of expenditure to be deductible, is that it must incurred ‘wholly and exclusively’ for the purposes of the trade, profession or vocation. References to CTA

14 Jul 2020 14:00 | Produced by Tolley Read more Read more

Losses on shares set against income

Losses on shares set against incomeUsually, allowable capital losses can only be set against chargeable gains. If the losses are not fully utilised against gains in the year in which they arise, the excess is carried forward to use against future gains. See the Use of capital losses guidance note

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

Subsistence expenses

Subsistence expensesIntroductionSubsistence is the amount incurred as a consequence of business travel. Typically it relates to accommodation and meal costs incurred. These amounts are allowed because they are associated with the necessary travel which is not to a permanent workplace. See the Travel

14 Jul 2020 13:43 | Produced by Tolley in association with Philip Rutherford Read more Read more