Seneca has added a quarterly income option to its range of business relief-qualifying investments, while rival Octopus will allow people to invest in its venture capital trusts through ISAs. Here's the latest tax-efficient news...
Seneca's new income paying option called Seneca Preference allows investors to choose a target annual yield of 3% or 5.25%, or a blend between the two.
The income will be paid as dividends four times a year in January, April, July and October, into the client's estate for inheritance tax (IHT) purposes.
Seneca believes investors will be attracted to an investment "which can provide them with a regular income but with the added benefit of the capital invested being outside of their estate for IHT purposes".
Business development director Ian Battersby said: "We have listened to the market in respect of what advisers and their clients would like to see. The opportunity to invest in a secure lending product and obtain quarterly income of up to 5.25% pa, rather than target income which derives from the stock market, is in itself an attractive alternative for many investors.
"When the capital sum invested also qualifies for business relief then it presents a neat solution. Investors who are looking for income in retirement see the dual attractions as do elderly clients who may have long term care commitments in their thinking."
Octopus ISA VCT; £120m fundraiser
Meanwhile, VCT provider Octopus will allow people to invest in its VCTs through their ISA, which it claimed is a market first, while launching a fundraise with a target of £120m for its Titan VCT.
If fully subscribed, the £120m fundraise will take the Titan VCT total fund size past the £600m assets under management mark and represent a sizeable chunk of the VCT sector, which had a total £3.9bn invested at the end of the 2016/17 tax year, according to the Association of Investment Companies.
The VCT sector raised a total £542m in 2016/17 - the second highest amount in the sector's 22-year history.
Octopus Investments managing director Paul Latham said: "By enabling people to invest in a VCT through their ISA, we are opening up the VCT market to more investors. We want to give people the opportunity to access the planning benefits of a VCT and the growth potential of some of the UK's most exciting growth companies."
Titan VCT fund manager Jo Oliver added: "The investment opportunity for early stage investing in this country is huge. Titan often backs successful companies from the earliest stage of their development working closely with the talented entrepreneurs building them."
Downing ONE top-up
Downing too has launched a £20m top-up offer for its Downing ONE VCT to "take advantage of a strong pipeline of new opportunities" and support the growth of its existing portfolio companies.
With net assets of about £90m, Downing ONE is one of the larger VCTs in the market and also claimed to be one of the more diversified, with approximately 80 companies in its current portfolio.
As well as offering the top-up offer, investors in the VCT can now also opt for monthly subscriptions into the fund that aims to provide an annual dividend of at least 4%. Downing said this is equivalent to a tax-free yield of 5.7% per year on the current offer price.
Downing partner and head of unquoted investments Kostas Manolis said: "We believe supply and demand is still skewed in favour of investors as there are many small companies with exciting prospects that are still struggling to access funding from traditional funders such as banks.
"This latest fundraise comes at an exciting time for investors - there is a healthy pipeline of interesting investment opportunities in the market and signs of strong appetite for VCTs more broadly."
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