New Money Entering VCTs Drops 18% Yet Still Rank Third Highest on Record

VCTs Still on the Money‑Track: New Funds Hit £882 m Despite the Dip

Numbers at a Glance

New Investment: £882 million this tax year.
Year‑over‑Year: Down about 18 % from last year.
Record Rank: This is the third highest ever—only 2021/22 and 2022/23 beat it.

What the VCT Hive is Buzzing About

Alex Davies, the founder and CEO of Wealth Club (the biggest VCT broker in the UK), says:

“Even with the economic uncertainty last year, VCT sales still topped the charts as a record third highest tally. The push‑in‑last‑minute wave, as the 5th April deadline loomed, was the hero.”

He adds that VCTs are a sweet spot for the wealthier investor juggling lofty tax bills and limited allowances.

Why VCTs are Still the Party‑Starter

Tax‑friendly allure: At a 70‑year high, ordinary investments like buy‑to‑let and pensions feel the squeeze.
Quick & clean: Simple structure, powerful tax efficiency.
Portfolio spice: Backing UK’s freshest, most promising start‑ups gives a morale and portfolio boost.

It’s Not Just About the Tax‑breaks

VCTs let you invest in Britain’s bright‑and‑young companies.
You help generate jobs and spur growth—yes, that’s the real money in the equation.
Aligns your money with future‑generation billion‑dollar companies.

All in all, the influx of £882 million does more than just tick a box on a spreadsheet. It feeds the entrepreneurial hive that keeps Britain’s economy buzzing.

What Happens to UK Venture Capital Trusts (VCTs) in 2024/25?

Think of 2024/25 like a roller‑coaster that’s just getting off the track. The UK is gearing up for an election, and no matter who pulls the trigger, taxes are on the rise. It’s a wild ride, but there’s one thing that both major parties are cheering for: Venture Capital Trusts.

Why VCTs are Still the Cool Kid for Rich Investors

Tax‑sweet spots: With capital gains tax and dividend allowances getting sliced again, VCTs remain one of the few ways to keep your tax bill lighter.
Policy backing: Whether it’s the Conservatives or the Labour, both sides are pledging support for VCTs as a vehicle to boost the UK’s startup scene.
Frozen thresholds: Tax caps aren’t lifting anywhere soon, which means the higher‑income crowd will keep seeing heavier bills, making VCTs an attractive haven.

Bottom line: VCTs Will Keep Their Popularity

If you’re among the high earners looking to grow your money on a tax‑friendly basis, VCTs are still going to be the go‑to choice. Even with the looming tax hikes, these trusts offer a way to keep gains and dividends out of the tax net.