Can you sell to your employees?
Selling to a trust that owns the company for all its staff can leave half of your profit on the sale untaxed, if nine rules are met. We check each one on your answers and say what to change for any that isn't.
Your answer
Answer the questions to see which of the nine rules your company meets.
About this calculator
For company owners thinking of selling to their staff through an employee ownership trust (EOT). If nine rules are met, half of the profit on the sale is left untaxed (Taxation of Chargeable Gains Act 1992, section 236H, for sales from 26 November 2025). The other half is taxed as usual, with no Business Asset Disposal Relief.
You type in the figures: the staff, the trustees, the price and the valuation. We don't look anything up or read your accounts or trust deed, and we never value the company. Each rule is checked exactly on your answers, so a pass here is a first check: an accountant and a solicitor should confirm the details before you sign.
Not sure of an answer? Choose Not sure, or leave a number empty. That rule shows as not checked, and we say what to find out. We never guess.
What happens to your answers
We don’t keep them. Your answers go to our server to do the sums and aren’t stored or logged. If you copy a link to your answers, they’re in the link itself, so only share it with people you trust.
How it’s worked out
We check nine rules one at a time: the company mainly trades; the trust will own more than half of it; all staff share on the same terms; owners and their close family are no more than two fifths of the staff; every trustee lives in the UK for tax; trustees linked to the sellers are fewer than half; the price is no more than the valuation; the trust first gets control in the tax year of the sale; and nobody selling has had this relief on the company before.
On the line, the rules are exact: a trust owning exactly half fails, owners and family at exactly two fifths pass, and exactly half the trustees linked to the sellers fails. Any rule not met gives "Not yet", with what to change. Otherwise any rule not checked gives "Not sure yet".
If every rule is met, half of your profit is left untaxed and the other half is taxed at up to 24%, due by 31 January after the tax year of the sale. The rules must keep being met until the end of the fourth tax year after it. In the example, a £2.4m sale with £1.8m profit meets all nine: £900,000 is left untaxed, and the tax on the rest is at most £216,000.
Worked example
Yes: on your answers, the company meets all 9 rules for selling to an employee ownership trust (EOT).
your answers taken as true · trading as you judge it · a company trustee counted as its directors · selling on 1 March 2027 · 2026/27 Capital Gains Tax rates
| The company mainly trades | Met |
|---|---|
| The trust will own more than half of the company | Met |
| All staff share in the trust on the same terms | Met |
| Owners and their close family are no more than two fifths of the staff | Met |
| Every trustee lives in the UK for tax | Met |
| Trustees linked to the sellers are fewer than half of the trustees | Met |
| The price is no more than the shares are worth | Met |
| The trust first gets control in the tax year of the sale | Met |
| Nobody selling, or close to them, has had this relief on the company before | Met |
| Rules met | 9 of 9 |
| The profit you expect on the sale | £1,800,000 |
| Left untaxed (50%): the trust takes the shares at a lower cost instead | − £900,000 |
| Taxed as usual | £900,000 |
| Capital Gains Tax on that, at most (24%, no Business Asset Disposal Relief) | £216,000 |
Checked against the rules for selling to an employee ownership trust (Taxation of Chargeable Gains Act 1992, sections 236H to 236O), with 50% of the profit left untaxed on sales from 26 November 2025, and HMRC's Capital Gains Tax rates for 2026/27. A first check on your answers, not legal or tax advice.
Questions people ask
Does passing this check mean we get the relief?
No. It checks the answers you gave against the rules. HMRC looks at the real facts, and the rules must keep being met for the tax year of the sale and the four after it, or the relief can be taken back.
Can we still sell to our staff if we fail a rule?
Often yes, once the plan changes. Each rule not met comes with what to change. You can also sell to a staff trust without the relief, but then the whole profit is taxed in the normal way.
Who counts as linked to the sellers?
Anyone who owns 5% or more of the company, and their husband, wife or civil partner, parents, grandparents, children, grandchildren, brothers and sisters (and theirs), and business partners. An unmarried partner isn't counted in law, but check with us if the answer is close.
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