Trade body calls on Treasury to reform VCT rules

Investment power eroded by inflation

The Venture Capital Trust Association (VCTA) has called on the Treasury to bring the rules surrounding VCTs “up to date” and allow them to “realise their full potential”.

In a policy paper, the association highlighted the role VCTs play within the UK economy – emphasised by the extension to the sunset clause to April 2035 – but also outlined several areas of concern that the Treasury should address. The VCTA urged Chancellor Rachel Reeves to raise VCT limits to stop their investment power being eroded by inflation, as so far, it has almost halved from what it was in 2016, the paper noted. Currently, the lifetime limits for VCT investee companies stand at £12m and £20m for knowledge intensive companies, while the annual limits are £5m and £12m, respecti...