- venture capital trust
(VCT)Introduced in 1995 to encourage investment in small and start-up companies. Individuals invest in a quoted vehicle which in turn invests in the debt and equity of a spread of unquoted smaller companies.A VCT typically takes the form of an investment company quoted on the London Stock Exchange.An individual investor in a VCT is entitled to 40% income tax relief on the amount invested up to £200,000 provided that the investor's VCT shares are held for at least three years.Investors in VCTs also receive an exemption from capital gains tax on any gains on the sale of the VCT's shares and exemption from income tax on dividends from the VCT. The VCT itself will not pay tax on dividends received from its investee companies but will be taxed on interest received. It is also exempt from tax on gains on the disposal of its investments.
Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010.
Look at other dictionaries:
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