Venture Capital Trusts - Tax-free dividends and capital growth available from UCTs, is largely ignored

Since launch in 1995, most of the focus has been on the upfront tax relief, ignoring Isa-style benefits of vehicles for taxpayers over 18 investing up to £200,000 per annum

Venture capital trusts (VCTs) were introduced in 1995 as tax-efficient investment vehicles and so there is much evidence of what has worked for the private investors since then. Investors and their advisers have typically focused on up front income tax relief, which remained at 20% until 2004 and then was boosted to 40% until April 2006. The current level of 30% has been fixed for the life of the current parliament. Little attention has been paid to date to what is, in effect, the £200,000 Isa-style benefit of VCTs. UK taxpayers aged 18 or over investing up to £200,000pa receive tax free ...