If there are unallocated shares held within an employee trust at the time that there is a sale of the sponsoring company, the trustees would sell those shares as part of the transaction, potentially giving rise to a substantial CGT liability if the trustees are resident in the UK.

The only way that any resulting cash held by the trustees could be used would be to pay it out to beneficiaries – any such transaction would constitute a ‘relevant step’ for the purposes of ITEPA 2003, Pt. 7A and would give rise to PAYE and NIC liabilities for both the employer and employee. No credit would be given for the CGT that the trustees had already suffered.

Need help? Get subscribed!

To subscribe to this content, simply call 0800 231 5199

We can create a package that’s catered to your individual needs.

Or book a demo to see this product in action.