Hargreaves Lansdown has launched a new Venture Capital Trusts (VCTs) online service.
The service aims to increase capital into the investment vehicles and brings a “straightforward and transparent” product to the VCT market, the firm said.
The latest statistics from The National Audit Office (NAO) show that in 2022 to 2023, over 26,000 VCT investors claimed income-tax relief on £985m of investment.
VCTs are investment vehicles that were set up to promote investment in small UK businesses that meet certain criteria.
To encourage support for these businesses, the government offers generous tax benefits.
The new client offering starts with five VCTs:
- Octopus Investments – Octopus AIM VCT, Octopus AIM VCT 2, Octopus Apollo VCT;
- Blackfinch Ventures – Blackfinch Spring VCT;
- Calculus – Calculus VCT;
Hargreaves Lansdown head of platform investments Emma Wall said: “HL’s new VCT online service will broaden our client offering, support the VCT investment market and help shape it for the future.
“After the commitment made by the government to extended VCTs to 2035, and given the tax changes announced in the Budget, VCTs are a great way for people to invest their money in a tax-efficient way, over the longer term, as part of a diverse investment portfolio.
“The VCT market has been a vital tool for entrepreneurial UK businesses to get the seed funding they need to kick-start their enterprise for nearly 30 years, which has helped the UK to be one of the best places in the world to start a business.
“Using our market leading position and scale, our VCT service has the potential to help the VCT market grow in the future, delivering favourable returns for investors, and support more businesses at the start of their growth journey.”
Octopus Investments head of investment products Jess Franks added: “It’s great to see Hargreaves Lansdown coming back to the world of VCTs.
“What this shows is how VCTs are continuing to become a more mainstream part of investing for those clients who undertake their own planning and are comfortable with the risks associated with the asset class.
“This launch also comes at a good time, with the government’s recent extension of VCT legislation until April 2035.”
Applications to the new service will incur a £50 dealing charge, with no platform fee. Following the initial investment, a £50 fee will be charged on VCT trades.
Since 1995, VCTs have generated an estimated £41bn of investment.
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