Position F — The Five-Minute Version

A short overview of Position F: a per-company estate election at death between settlement under the existing reform and a deferred-realisation regime capped at ten years. The proposal in five minutes, with the case for, the case against, and how it sits alongside the publication's existing design positions. The full long-form treatment is linked at the end.

The proposal in one paragraph

On the death of a qualifying shareholder in an unlisted UK trading company, the personal representatives elect — per company — between two regimes. Regime 1 is the April 2026 reform as written: tax at death on the SAV valuation, paid through the ten-year interest-free instalment plan. Regime 2 defers the inheritance tax charge until the shares are sold, subject to a hard ten-year backstop. The rate is locked at the rate that would have applied at death; the taxable base is the greater of (a) actual sale proceeds or (b) the date-of-death valuation (so the Treasury never receives less than under Regime 1); a deemed disposal at year ten closes the file regardless. The CGT uplift, currently applied at death, is itself deferred under Regime 2 to keep the principle clean — the heir is not taxed twice, but the uplift does not arrive ahead of the IHT that justifies it. Anti-avoidance rules (connected-party valuations, exit charges on departure, asset-stripping triggers, continuing-qualification conditions) close the obvious gaming routes; most of them already exist in analogous form across UK tax legislation.

What it is not

Position F is not a CGT regime. The taxable transfer is still the death event, taxed at the IHT rate. What changes is when the calculated tax falls and what it is paid against. It is not a unilateral switch to realisation-based timing — estates that want certainty can elect Regime 1. It is not Position B. The case-against-B in the publication's timing piece — the Australian forty-year experience of indefinite deferral, valuation-gaming, and a family-trust deferral industry — is the case against an unbounded realisation regime. Position F is the bounded version: deferral capped at ten years, the Treasury's downside protected by the date-of-death floor, the gaming routes closed at the perimeter.

The strongest case for it

The valuation problem largely dissolves. The substantive tax falls against the actual sale price in the typical case; the SAV value at death sets the rate base and the floor only. Where shares appreciate during the window — the typical case for trading companies that survive a decade — the headline valuation is no longer where the substantive money sits.

The liquidity mismatch dissolves. Under Regime 1 the estate owes tax on a valuation; the ten-year instalment plan exists because the cash to pay the tax often is not in the estate. Under Regime 2 the tax falls when the cash arrives. The forced liquidity event the proposal is designed to address is the proximate harm, and Regime 2 prevents it directly.

Pre-death relocation pressure is reduced. A founder who knows their estate will be able to elect Regime 2 has a weaker reason to relocate before death. The exit-charge condition prevents the heir from realising a relocation benefit post-death.

Productive-economy alignment without the unbounded-deferral cost. The year-ten deemed disposal is the load-bearing rule that closes the door on the Australian pattern. Heirs sell when a sale makes commercial sense within the decade; indefinite generational deferral cannot arise.

What the proposal returns to founder families. The current reform creates a problem founder families cannot plan around because the timing variable — the date of death — is the one variable the founder cannot control. Position F preserves the Treasury's revenue through the floor and the year-ten backstop, while restoring to families the ability to choose when within the window the tax event falls. What founders considering staying or leaving the UK are weighing, in many cases, is not the tax itself but the exposure of their family to a forced event at an unknowable moment. Position F does not eliminate the tax. It eliminates the ambush. The full agency argument is in the long-form piece; it is the layer that makes the proposal politically defensible as something other than a tax break.

The strongest case against it

Treasury cashflow becomes lumpier. Death-event taxation gives HMRC a known forward profile of receipts. Position F means the Exchequer does not know which year of the next decade the receipt arrives in. A reader who weights fiscal-stability considerations heavily will treat this as a real cost.

Anti-avoidance perimeter has costs. Even where the legislative concepts are existing, applying them to this combination produces interactions that are not present in any existing regime. A practitioner industry will grow up around optimising the election and the window.

Horizontal equity. A founder dying with £20m of qualifying unlisted shares can elect deferred realisation; a founder dying with £20m of cash, listed equities, or property pays IHT at death. A reader who weights horizontal equity heavily will treat the differential as a problem rather than a feature.

Administrative inconsistency. Position F introduces a second mechanism for one asset class, parallel to but separate from the death-event mechanism that handles every other asset. The administrative-settledness argument the case-for-A draws on is real, and Position F weakens it.

How it sits alongside A, B, C, D, and E

Position F does not displace any of the five existing positions. It is a sixth option offered into the same analytical space. It composes with C (hold E while the Lords Sub-Committee research runs, evaluate F once cohort-specific evidence exists) and with D (D adjusts the amount; F adjusts the timing — they are independent). It is not a replacement for E or A; estates that elect Regime 1 are in E's or A's world depending on which mechanism overlay is in force.

Read the full treatment

This page is the gist. The full proposal — including the per-company election rule, the connected-party and exit-charge mechanics, the asset-stripping triggers, the deferred CGT uplift in detail, the empirical claims on which the case rests, and the alternative designs considered and rejected — is at A Founder Election with a Decade Cap.

A submission to the corrections-and-contributions route at thelongerlook.com. Written in the analytical register the publication uses. Not tax, legal, or financial advice. The author has a personal interest as a UK technology founder.