Octopus VCT has raised more money than any other individual VCT in the most recent tax year, according to figures from the Association of Investment Companies (AIC).
The flagship venture capital trust of Octopus Investments raised £50m in the year to 5 April, 2010. A second fund, Octopus Titan VCT 4, also features in the fundraising top 10 with £18.1m of new investment.
Entertainment specialist Edge Performance VCT is the second-biggest fundraiser on £28.8m, followed by TP10 on £27.3m.
Meanwhile, Downing Corporate Finance has four VCTs in the top 10. Downing Structured Opportunities VCT 1 raised £19.2m, while Downing Planned Exit VCTs II and III saw inflows of £19m and Downing Absolute Income VCT 2 raised £17.4m.
VCTs have had one of the most successful fundraising years in 2009 to 2010 with inflows of £340m. This is more than double the previous year’s total of £158m and ranks as fourth highest since VCTs were launched in 1995.
VCT managers believe tax changes and the perceived advantages of limited life vehicles has added to the attraction of VCTs.
Managing director Guy Myles says: “The tax planning environment has moved to VCTs because of changes to relief on pensions for high earnings and low interest rates.
“We expect this year to be another strong one as the alternatives are still not as attractive.”
Tony McGing, a director at Downing Corporate Finance says: “The changes to tax relief on pensions for higher-rate taxpayers have had a massive impact.
“Lower-risk vehicles such as planned exit VCTs have made it an easier step for people investing in the sector for the first time.”
McGing says around 60% of the money raised by VCTs went into limited life vehicles, with 28% into generalist and 11% into specialist.
