Helping clients understand VCTs
So you’ve identified a client who could benefit from a venture capital trust (VCT).
Step two is to help them understand what VCTs are and how they fit in with the rest of their planning.
Clients often like to know:
• Why VCTs offer tax reliefs in the first place, and why the government supports this?
• What type of companies do VCTs invest in?
• What are the risks?
Octopus has a number of client-friendly resources that can help you. To see how you can use VCTs to their full potential, use the links below.
• Webinar: Helping your clients get to grips with VCTs >>
• VCT 101 video: This video is a great way to introduce clients to VCTs >>
• Adviser tools: Access our VCT resource hub here >>
Key risks to keep in mind:
• The value of an investment in a VCT investment, and any income from it, can fall as well as rise. Investors may not get back the full amount they invest.
• Tax treatment depends on individual circumstances and may change in the future.
• Tax reliefs depend on the VCT maintaining its VCT-qualifying status.
• VCT shares are by their nature high risk, their share price may be volatile and they may be hard to sell.