"For experienced investors looking to reduce their tax bill, VCTs are a highly attractive proposition right now. Not only can 30% income tax relief be claimed upfront, but dividends are also protected from the taxman."
"VCTs are more than just a tax planning tool. They offer one of the most effective ways for UK investors to access fast-growing smaller companies. Revenue growth among VCT-backed businesses far outstrips that of many main market listed firms."
"Exposure to smaller, high-growth companies can also diversify a conventional portfolio. Their performance is often only loosely correlated with the wider economy, as disruptive businesses grow by taking market share rather than relying on overall market expansion."
"VCTs also play a vital role in supporting the next generation of UK start-ups - driving innovation, creating jobs and helping scale-ups expand. This broader economic contribution is a key reason the government provides such generous tax incentives."
Investors have just over a week to take advantage of 30% income tax relief on venture capital trusts (VCTs), which will decrease to 20% next year. Individuals can invest up to £200,000 annually to claim this relief. VCTs also provide tax-free dividends and Capital Gains Tax exemption if shares are held for five years. Financial advisers emphasize the urgency to act, as VCTs not only offer tax benefits but also access to high-growth smaller companies, contributing to economic growth and innovation in the UK.
Read at London Business News | Londonlovesbusiness.com
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