- £917.7 million invested into Venture Capital Trusts (VCTs) in the 2025/26 tax year (source: AIC)
- Third-highest year on record for VCT fundraising
- Top fundraisers: Albion VCTs (£90m), British Smaller Companies VCTs (£85m), Octopus Apollo VCT (£82.7m)
- Since launch in 1994, VCTs have invested over £12 billion into UK early-stage businesses
- Government reduction in income tax relief from 30% to 20% expected to significantly impact future investment
Alex Davies, Founder and CEO of Wealth Club, commented:
“The latest figures from the AIC show that £917.7 million was invested into Venture Capital Trusts in the 2025/26 tax year, making it one of the strongest years on record. This highlights the continued importance and appeal of VCTs for UK investors, particularly in a higher-tax environment.
The biggest raiser this year was Albion VCTs (£90m), followed by the British Smaller Companies VCTs (£85m) and Octopus Apollo VCT (£82.7m across two offers), demonstrating strong demand for well-established managers with proven track records.
VCTs play a vital role in the UK economy. In return for generous tax reliefs, investors provide capital that is deployed into early-stage and scaling UK businesses. Since their inception in 1994, VCTs have channelled more than £12 billion into ambitious companies across the UK. These businesses are crucial to economic growth, creating high-quality jobs and driving innovation across a wide range of sectors.
However, there is now a significant challenge facing the VCT market – and it is no longer a distant risk, but a reality. In the November Budget, whilst some VCT rules were improved, the Chancellor also announced that income tax relief on VCT investments will fall from 30% to 20% from this tax year.
History shows the potential consequences of such a move. The last time income tax relief was reduced, in 2006/07, VCT fundraising fell by 65% year-on-year. While the impact this time may be less severe – given today’s higher tax environment and fewer alternative tax-efficient investment options – we still expect a material decline in annual VCT investment.
This would be a negative outcome not only for investors, but for the broader UK economy. VCTs have been one of the UK’s most successful long-term investment schemes, supporting thousands of growing businesses and contributing meaningfully to employment and economic expansion.
We struggle to see the logic behind this policy decision. The projected tax revenue gain is relatively small – around £120 million per year – yet the potential damage to the funding ecosystem for start-ups and scale-ups, and the knock-on effects for growth and job creation, could be far greater.
We would strongly urge the Chancellor to reconsider this reduction in tax relief and continue to support a scheme that has delivered clear and lasting benefits to the UK economy.”
Top 5 VCT fundraises
Venture Capital Trust(s) | Raised from TY2526 offer | Raised during TY2526 from previous offer | TOTAL raised in TY2526 |
Albion VCTs | £90,000,000 | £90,000,000 | |
British Smaller Companies | £85,000,000 | £85,000,000 | |
Octopus Apollo VCT | £82,700,000 | £82,700,000 | |
Northern VCTs | £80,000,000 | £80,000,000 | |
Puma VCT 13 | £53,600,000 | £1,600,000 | £55,200,000 |
