Venture Capital Trusts


Why us?

Why us?

  • We charge a market-leading one-off fee of £30 (inc VAT) to process your VCT application
  • Award-winning trading software for desktop, web and mobile
  • Most VCTs offer broker discounts ­- which we will reinvest fully for you in new shares
  • Unlike some other brokers, we credit all the trail income we receive from your VCT investments, as cash in your account

How to Apply

Whether you are new to Interactive Investor or an existing client the application or transfer in process for VCTs is straightforward.

Find out more

Risk Warning
The price and value of investments and their income fluctuates: you may get back less than the amount you invested.The tax treatment of investments is subject to tax law and HMRC practice which are subject to change. Interactive Investor does not endorse any particular product. If you are unsure about whether an investment is suitable for you please seek advice from a financial advisor.

 

About VCTs

What is a VCT?

Venture capital trusts started life in 1995. They were launched to encourage investment in early stage companies by offering attractive tax breaks to investors. VCTs must be approved by HMRC in order for investors to receive the tax breaks, and there are limits on the size of companies in which VCTs can invest.

When investors subscribe for new shares in a venture capital trust, the tax breaks are extremely attractive. Investors can receive income tax relief of 30 per cent of the amount invested, up to £200,000. All dividends paid out of VCTs are tax-free, and all capital gains are also tax-free. This can make VCTs a viable addition to pension planning, particularly when pension limits for tax relief have been reached.

However, these are early stage investments and as such carry considerably higher risks than investing in more developed, stock market-listed companies. That said, the sector has cleared out in recent years and experienced investment managers now dominate the market.
  • High net worth and sophisticated investors who are UK residents.
  • Investors who have a sufficient income tax liability to reclaim income tax relief at 30% of the amount subscribed.
  • Investors who have realised a capital gain that would attract Capital Gains Tax.
  • Investors who will not need access to their capital for at least five years and are comfortable with higher risk investments.
Different types of VCTs:
  • Generalist VCTs - These VCTs invest in a wide range of companies in different sectors and stages of development.
  • AIM VCTs - As the name suggests they only invest in companies listed, or about to become listed, on the Alternative Investment Market
  • Specialist VCTs - Tend to focus their investment expertise on one particular sector eg. Healthcare
  • Limited Life VCTs - Set out on a 5+ year plan and will wind up the VCT at the end of this period.

 

Risks

What are the risks?

Any investments in VCTs should be viewed as a high risk and long-term commitment. (i.e. five years for VCT schemes, but plan for a longer time-frame). Due to the nature of the underlying assets these schemes are highly illiquid. Investors must be aware they may have difficulty or be unable to realise their shares at levels close to that which reflect the value of the underlying assets. The risk reward ratio of investing in smaller companies is inflated as the risk of failure is higher. Tax incentives available to investors exist in order to attract investment into an asset class that warrants high risk categorisation, but are subject to tax law and HMRC practice, both of which can change. These are complex products and are only suitable for sophisticated investors. Please ensure you understand the risks involved. If you are unsure about the suitability of any investment please seek financial advice.

 

Are VCTs right for me?

Are VCTs right for me?

Investors should feel comfortable that they meet the following criteria:
  • High net worth and sophisticated investors who are UK residents.
  • Investors who have a sufficient income tax liability to reclaim income tax relief at 30% of the amount subscribed.
  • Investors who have realised a capital gain that would attract Capital Gains Tax.
  • Investors who will not need access to their capital for at least five years and are comfortable with higher risk investments.

 

Current offers

Name Min InvestAmount Raising Amount Raised Initial Charge Total Discount* 100% Trail Refund** Key documents
Generalist - These VCTs invest in a wide range of companies in different sectors and stages of development.
Maven Income & Growth £5,000 £30m £4m 5% New customers: 3.75% until 2nd February 2018 / 2.5% thereafter Existing customers: 4% until 2nd February 2018 / 2.5% thereafter Apply
Factsheet
Baronsmead £3,000 £45m with a £15m over allotment facility £24m 3% Apply
Factsheet
Puma 13 £5,000 £30m with a £15m over allotment facility £0 3% with an annual management fee 2% Apply
Factsheet
Octopus Titan £3,000 £120m / potential for a further £80m £27.5m 3% Early bird discount of 2% until 14th November 2017, Loyalty discount of 1% for existing Octopus VCT shareholders Apply
Factsheet
Mobeus £6,000 £50m £38.3m 3.25% Early Bird discount 0.75% up to 3rd November 2017 Apply
Foresight 4 £3,000 £50m with £50m over-allotment facility £5m 3% Initial charge 5.5% for direct investors. 2.5% for Execution only, Professional Clients and Retail Clients. Early Bird: discount of 2% before 31st July 2017. 1% discount before 30th November 2017. 0.5% loyalty bonus always. Apply
Factsheet
AIM - As the name suggests they only invest in companies listed, or about to become listed, on the Alternative Investment Market.
Hargreave Hale £5,000 £7.5m £7.5m 3.5% 2%( until 17/11/2017, 1% thereafter) Apply
Unicorn £2,000 £30m (with £20m overallotment) £23m 5.5% 3.0% 0.375% p.a. Apply
Factsheet
Octopus £5,000 £40 million £27.5m 3% No discount Apply
Factsheet

Early bird discount. Initial discounts reinvested for extra shares

**All trail commission, if available, is credited to your account as cash. Trail is paid annually up to 5 years after initial investment. Terms vary

The rates above have been checked with the VCT providers but are subject to change.