Venture capital trusts offer generous income tax relief, tax-free dividends and the chance to strike it rich with early stage companies, yet remain something of a mystery to many investors.
Rare encounters with them may crop up – perhaps on suggestion of a financial adviser promoting the tax benefits – but VCT fans argue that there’s much more to them than tax relief and they can make a profitable and interesting part of an investor’s portfolio.
But this investment in unlisted young companies, hoping to emulate Zoopla, ARM, or Innocent, comes at a price – and is riskier than a standard investment fund.
To find out more about what VCTs do, what they invest in, and, of course, the tax benefits, we invited Stuart Lewis, head of tax, at Octopus Investments to join us on the Investing Show.
We ask him why people would consider a VCT and also to explain the risks and why investing fees are high.
Also on this fortnight’s show, Richard Hunter, of Wilson King Investment Management, takes another look at bank prospects.
Britain’s big banks have seen their share prices suffer even as the FTSE 100 has risen after Brexit. Investors uncertain about the economic outlook and low interest rates have been shunning banks, so are they an opportunity or to be avoided?
And, later in the first part of the show Nick Batsford, of TipTV, takes a look at what a rise in inflation means for our money.