£1.122bn invested into VCTs – official HMRC figures published today
VCTs are a government scheme launched to encourage investment into businesses in need of next stage funding to boost entrepreneurial activity with tax breaks for investors willing to accept the higher risks in pursuit of high rewards. The scheme which was introduced in 1995, is one of four tax-based venture capital schemes and the VCTs raise funds for investments, normally annually, through new and/or top-up share issues to investors.
The research which can be viewed at this link: Venture Capital Trusts statistics: 2022 – GOV.UK (www.gov.uk)
Alex Davies, CEO and founder of Wealth Club said: “Having raised £1.122 billion this tax year, VCTs are really edging into the mainstream. They are packed with some of the fastest growing and most exciting early stage UK businesses and can complement an existing pension and other more mainstream investments as well as provide investors with an attractive tax free income stream.
Wealth Club’s own figures published in April had already shown that the last tax year was a bumper year for VCTs and the official figures released by HMRC today highlight the extent to which the scheme is working. Businesses raising money from VCTs over the past year include Outpost VFX, creating visual effects for film and TV, Peckwater Brands, a delivery franchise for kitchen operators, Peppy, which is supporting individuals to access health experts on issues such as fertility and menopause, and Popsa’s photobooks.
These numbers are really promising for the British economy and investors alike and really demonstrate the success of the scheme. Despite economic uncertainty demand for VCTs in the current tax year is also holding up and we expect it to be another bumper year.”
The number of VCTs raising funds in 2020-21 has increased from the previous tax year to 46 from 40. There has been a significant increase in the amount raised by VCTs in 2021 to 2022, though only a small number more raised funds, reflecting further concentration of the VCT market.
