VCT Information

Summary

A Venture Capital Trust (VCT) is a publicly listed company. The company, run by a fund manager, invests in a number of small unquoted companies. Therefore an investor into a VCT is investing in the fund manager’s selected portfolio of earlier stage UK companies, and thereby helps them to grow. To encourage investment of this sort, the government provides a number of tax benefits to qualifying UK investors

Tax Benefits

The benefits of investing into a VCT qualifying company include:

  • 30% Initial Income Tax Relief

    Actual net cash outlay 70 pence in the £1


  • CGT Freedom

    No Capital Gains Tax to pay


  • The Tax Free Dividend

    Dividends from your VCT shares are not subject to income tax

See All Tax Benefits

Qualifying Criteria

There are several criteria that businesses will need to meet in order to qualify for VCTs, some trades are also excluded. For example the business must:
  • A company must be unquoted (companies whose shares are listed on the AIM market are considered unquoted)
  • The company must have fewer than 250 full time employees (or 500 for a knowledge-intensive company)

  • Gross assets must be less than £15 million prior to investment, and £16 million straight afterwards
  • It must be a permanent establishment in the UK

Further Information

Further information on VCTs can be found on the HMRC website, as well as on the AIC website, the trade organisation for the industry