What About Founders Whose Shares Cannot Be Sold?

A founder can hold most of what they own in a company that has never paid them a dividend. The shares are worth something on paper, and a fund that bought in last year will say exactly what; none of it can be turned into cash by the end of the month, because a fifth of a private company has no ready buyer at a month's notice and the shareholders' agreement may forbid the sale anyway. Charge that holding every year, the objection runs, and you force the sale of the thing being taxed.

The objection is right about the cash. What follows from it is a design question, and two countries have already answered it in opposite ways.

Two cases, and only one of them is a liquidity problem

An asset that cannot be sold and an asset the owner would rather not sell are different cases. The first is a founder whose stake is locked by a shareholders' agreement, or whose company has no buyer for a minority holding at any price the founder could accept. The second is an owner with a business that could pay a dividend and a bank that would lend against it, who prefers to keep every pound inside the company. Both will describe the tax bill as unpayable. Only the first is describing a liquidity problem, and a workable design has to be able to tell them apart.

The model this series argues for begins above £10 million of an individual's net wealth after debts, so the holding has to be large before its owner is in the tax at all. Founders of that size exist, and the countries that already run a wealth tax have had to decide what to do about them. Two of them chose opposite answers.

Norway defers, and charges for it

From the 2026 income year, Norway lets wealth tax calculated on business assets be deferred for up to three years, on amounts of at least NOK 30,000, with interest at Norges Bank's key policy rate plus five percentage points. The qualifying assets include shares, share savings accounts, partnership interests and the fixed assets and commercial property of a sole proprietorship. A founder's stake is on the list.

What the founder gets is time. The state keeps its claim, the claim earns interest, and after three years it falls due whether or not anything has been sold. The scheme buys three years at a price, and the price is set so that waiting is never free. The rule was current as verified on 12 August 2026, and Norway resets its wealth-tax rates and thresholds every year.

Spain exempts, and pays for it elsewhere

Spain chose the other answer. Article 4.Ocho of Ley 19/1991 exempts qualifying family-business holdings from wealth tax altogether, on conditions. The taxpayer must hold at least 5 per cent of the company individually, or 20 per cent within the family group; must effectively exercise management functions in it; and must be paid for doing so more than half of their total business, professional and work income. The exemption is pro rata, reaching only the assets necessary for the activity, net of the debts attached to them, so passive assets parked inside an operating company stay in charge.

For the founder who runs the company, lives on its salary and keeps nothing inside it beyond what the business needs, that is a complete answer: nothing is owed on the stake, so nothing has to be sold. For everyone else it is a set of tests. The tax authority has to know who manages what, and who is paid how much, every year, for every holding that claims the relief. The provision was current as verified on 12 August 2026.

The UK's own precedent

Britain has no annual wealth tax, and its statute book already contains a payment rule for this kind of asset. Inheritance Tax Act 1984 s.227 lets the tax on qualifying property be paid in ten equal yearly instalments by written election, and Finance Act 2026 extended that class to relevant business property. If the property is sold, the unpaid tax falls due at once. Whoever inherits qualifying business property can elect to pay the tax on it over a decade, and the sale that would produce the cash is the event that ends the instalments.

It is an Inheritance Tax provision, written for a charge that arrives once. Applied to an annual charge it would create overlapping instalment streams, one for each year, so an annual tax would need a clause of its own. The provision was current as verified on 12 August 2026. Whether interest runs on those instalments is a separate provision that this article does not rely on.

Where the objection is right

Spain's exemption is wide, and width has a cost of its own. An exemption for actively managed family holdings pulls wealth towards that form, because the shareholding that qualifies is worth more after tax than the one that does not, and the management and remuneration tests that police the line are demanding to apply. Norway's three years is shorter than the wait a founder may face for any liquidity event at all; a company that takes a decade to reach a sale will have outlived the deferral long before the exit arrives.

No operating regime has managed accurate annual valuation, low administrative cost, neutrality between asset classes and full liquidity protection at once; each protects one of them by conceding another. Spain concedes neutrality. Norway concedes part of the protection. And nothing cited here measures how often a founder under either regime has actually been made to sell, so no figure for how common a forced sale is appears here, in either direction.

What the design has to contain

Deferral with interest, settled at the first genuine liquidity event, leaves ownership intact and the claim alive. The trigger is the part the existing rules leave out. Norway's deferral ends on a date; s.227's instalments end on a sale. A founder's company produces cash in more ways than one: a dividend, a funding round in which existing shares are sold, a partial sale to a buyer, a flotation. Any of them can serve as the trigger, and the first to happen is the moment the deferred charge is paid from the proceeds.

The trigger is also what separates the two cases in the opening section. An owner whose company has paid a dividend has had a liquidity event, and the deferral ends with it whether or not they wanted to spend the money on tax. An owner whose company has produced nothing keeps deferring, and keeps paying interest for the privilege, until it does.

The state never has to ask which kind of owner it is dealing with. The cash answers.

Interest is what keeps the deferral from becoming a discount. Priced at or above what the state pays to borrow, a charge that waits a decade costs the Exchequer nothing for waiting, and the founder settles the same charge later, from money the company has by then produced. The test of a liquidity provision is whether it protects the owner while still reaching the wealth. Compare Norway's deferral with Spain's exemption.

Sources and evidence status

Skatteetaten, Defer payment of net wealth tax calculated on business assets (the Norwegian deferral from income year 2026, its cap, minimum, interest margin and qualifying assets), verified 12 August 2026. Ley 19/1991 del Impuesto sobre el Patrimonio, art. 4.Ocho (the family-business exemption, its holding, management and remuneration conditions and its pro-rata limb), verified 12 August 2026. Inheritance Tax Act 1984 s.227 as amended by Finance Act 2026 Sch. 12 (ten yearly instalments, the extension to relevant business property, the balance falling due on sale), verified 12 August 2026. Comparative reading of the Swiss, Norwegian and Spanish regimes on valuation, cost, neutrality and liquidity, and what each concedes, verified 12 August 2026. Threshold and unit of the model this series references: a policy proposal, not enacted law.

The Norwegian, Spanish and UK provisions are T8 Legal or Regulatory Statements, current at the date given; the Norwegian rules are reset annually and the UK provision was amended by Finance Act 2026, so none should be relied on without checking its date. The Spanish exemption is conditional and pro rata, not a blanket carve-out. The UK provision belongs to Inheritance Tax and is cited as a transfer-tax precedent for instalment payment, not as a wealth tax and not as a proposal for one; its interest treatment is not asserted. The comparison of the two regimes, the cost of a wide exemption, and the statement that no regime has settled valuation, cost, neutrality and liquidity together, are T5 Economic Interpretation drawn from those provisions. The reference model's threshold and unit are a T4 Policy Proposal. The design in the last section is a proposal in the brand's voice. No figure for the frequency of forced sales under any regime, and no figure for what a UK deferral would cost or defer, is asserted here, and none should be inferred.

Nothing here is tax advice.