Tax relief boost sees VCTs all set to go the distance

VCTs

The 40% income tax relief granted to VCTs in March 2004 has boosted the market, while legislation introduced in September 2004 protects investors' tax reliefs at a time when VCTs may be merged or liquidated

The boost from 40% income tax relief since March 2004 on subscription into venture capital trusts (VCTs) is working. Existing and new VCT investment managers have responded by issuing an unprecedented range of prospectuses from which private investors and their advisers can choose. Over £180m has been raised to date, and £400m might be raised in the current financial year. This is seven times more than last year when the former tax regime ended. 60% of the new capital is being placed with Generalist VCTs, 30% is being placed with Aim focused VCTs and the balance is in specialist VCTs. Adv...