Home / Insights / Blog / Consultation on tax relief schemes

Consultation on tax relief schemes

Consultation on tax relief schemes

New tax relief schemes for employee-owned firms could be in the pipeline. A Government consultation aimed at encouraging such businesses might create new indirect employee-ownership structures, where staff shares are held collectively in an employee benefit trust. Two new measures are being considered.

Firstly, when a controlling share of a firm is sold into an indirect structure, a capital gains tax relief could be awarded, providing an alternative option for those wanting to sell their business.

Secondly, a national insurance contribution exemption could be applied to indirectly employee-owned firms, while businesses could be given the chance to pay staff a fixed annual amount without deducting national insurance or income tax.

The consultation’s launch marked Employee Ownership Day, and follows an announcement made during the 2013 Budget regarding the provision of £50 million a year from 2014-15 to support employee-ownership models. The Nuttall Review of Employee-Ownership in 2012 claimed employee-owned firms are more resilient, create jobs quicker and foster increased commitment from staff.

IBB’s Employment Team provides advice on the employment aspects of all major business decisions. To contact a member of the team for advice, call us on 01895 207892 or email employment@ibblaw.co.uk