Accredited official statistics

Venture Capital Trusts statistics: 2024

Published 23 May 2024

1. Main findings

Both the number of Venture Capital Trusts (VCTs) managing funds has decreased in the tax year 2022 to 2023 and the amount of investment raised by the remaining VCTs has decreased compared to 2021 to 2022.

The amount of investment Income Tax relief is claimed on fell in 2022 to 2023, reflecting the decrease in funds raised by VCTs in that tax year.

1.1 Headlines

• Venture Capital Trusts (VCTs) issued shares to the value of £1,001 million in 2022 to 2023, which is 10% lower in comparison to the 2021 to 2022 figure of £1,112 million.
• The number of VCTs raising funds has decreased by 1 to 44 in the tax year 2022 to 2023.
• The number of VCTs managing funds has decreased by 4 to 48 in the tax year 2022 to 2023.
• In 2022 to 2023, Venture Capital Trust (VCT) investors claimed Income Tax (IT) relief on £985 million of investment. This is a decrease of 6% from 2021 to 2022.
• The number of VCT investors who claimed Income Tax relief has broadly remained consistent increasing by just 1% to 26,260 in 2022 to 2023.

2. Introduction

2.1 About these statistics

This is an annual National Statistics publication of Venture Capital Trusts (VCTs) statistics.

Section 3 (number of VCTs and funds raised) includes figures covering the period up to tax year 2022 to 2023. This section now utilizes HMRC administrative data, improving the quality of the underlying data and includes figures covering the period up to tax year 2022 to 2023. Section 4 (investors claiming relief on VCT investments) includes first estimates for 2022 to 2023. The deadline for submitting Self Assessment returns for the tax year 2022 to 2023 was 31 January 2024 and individuals may submit late claims, therefore the data for 2022 to 2023 is currently incomplete for publication and has been uplifted to account for the late returns. Information about the data sources and methodology can be found in the Background quality report.

In Table 1, figures for 2021 to 2022 are revised and 2022 to 2023 are provisional.

In Tables 2a and 2b, figures prior to 2022 to 2023 are revised and figures for 2022 to 2023 are uplifted to account for late returns and provisional.

The next release of these statistics is expected to be in Spring 2025. If you would like to comment on these statistics, please see the contacts named at the end.

2.2 What are Venture Capital Trusts?

The VCT scheme, introduced in 1995, is one of four tax-based venture capital schemes that were active in the 2022 to 2023 tax year. VCTs raise funds for investments, normally annually, through new and/or top-up share issues to investors.

For more information about Venture Capital Trusts and the policy background, see the Venture Capital Trusts statistics: Introductory note.

3. Amount of funds raised and number of Venture Capital Trusts

Values listed under “new series” utilise HMRC administrative data which improves the quality of the underlying data. Values listed under “old series” provide information on the number of VCTs and funds raised are obtained from publicly available internet sources, mainly FE Investegate VCTs information and news announcements. From tax year 2022 to 2023 onwards, only the new series will be reported.

Table 1 provides information for 2022 to 2023, using the new administrative data. It also provides a comparison between the old and new series for tax years 2019 to 2020 to 2021 to 2022 which shows that both series follow the same trends and the difference between the two series is small. The funds raised shown by both series increase over the three years, reaching a peak in 2021 to 2022. The difference between the two series is small.

The number of VCTs raising and managing funds between tax year 2019 to 2020 and tax year 2021 to 2022 also follow the same trend between the two series, with a difference of just one VCT raising funds in 2021 to 2022 and one VCT managing funds in 2019 to 2020.

Amounts raised have been rounded to the nearest £5 million for data up to 2016 to 2017 and £1 million for 2017 to 2018 onwards.

Table 1: Amount of funds raised and number of Venture Capital Trusts (VCTs) by year, 1995 to 1996 to 2022 to 2023

Due to a technical issue, one column (‘Rate of IT relief (%)’) is not visible to some users. Please use the scrollbar at the bottom of the table to view this column. We apologise for the inconvenience.

Year	Funds raised, New Series (£ million)	Funds raised, Old Series (£ million)	VCTs raising funds, New Series	VCTs raising funds, Old Series	VCTs managing funds, New Series	VCTs managing funds, Old Series	Rate of IT relief (%)
1995-96	not applicable	160	not applicable	12	not applicable	12	20
1996-97	not applicable	170	not applicable	13	not applicable	18	20
1997-98	not applicable	190	not applicable	16	not applicable	26	20
1998-99	not applicable	165	not applicable	11	not applicable	34	20
1999-00	not applicable	270	not applicable	20	not applicable	43	20
2000-01	not applicable	450	not applicable	38	not applicable	61	20
2001-02	not applicable	155	not applicable	45	not applicable	70	20
2002-03	not applicable	70	not applicable	32	not applicable	71	20
2003-04	not applicable	70	not applicable	31	not applicable	71	20
2004-05	not applicable	520	not applicable	58	not applicable	98	40
2005-06	not applicable	780	not applicable	82	not applicable	108	40
2006-07	not applicable	270	not applicable	32	not applicable	121	30
2007-08	not applicable	230	not applicable	54	not applicable	131	30
2008-09	not applicable	150	not applicable	46	not applicable	129	30
2009-10	not applicable	340	not applicable	68	not applicable	122	30
2010-11	not applicable	350	not applicable	78	not applicable	128	30
2011-12	not applicable	325	not applicable	76	not applicable	124	30
2012-13	not applicable	400	not applicable	65	not applicable	118	30
2013-14	not applicable	440	not applicable	66	not applicable	97	30
2014-15	not applicable	435	not applicable	57	not applicable	94	30
2015-16	not applicable	445	not applicable	45	not applicable	80	30
2016-17	not applicable	570	not applicable	38	not applicable	75	30
2017-18	not applicable	705	not applicable	43	not applicable	68	30
2018-19	not applicable	716	not applicable	42	not applicable	61	30
2019-20	606	645	43	43	60	61	30
2020-21	681	668	40	40	57	57	30
2021-22	1112	1122	45	46	52	52	30
2022-23	1001	not applicable	44	not applicable	48	not applicable	30

Venture Capital Trusts (VCTs) have raised funds to the value of £1,001 million in 2022 to 2023, which is 10% lower than the 2021 to 2022 figure of £1,112 million.

Figure 1: Amount of funds raised by VCTs (£ million), 1995 to 1996 to 2022 to 2023

Figure 1 reports the funds raised by VCTs using the old series between tax years 1995 to 1996 to tax year 2018 to 2019. From 2019 to 2020 funds raised are reported using the new series, with the change in series marked by the black vertical dashed line. The amount of funds raised by VCTs has been on a rising trend in recent years and has more than doubled since 2009 to 2010. Much of this increase is likely due to the increasing appeal of the tax benefits of VCT investment as an alternative or addition to pension investment where allowances have been reduced or capped in the same period. This made traditional pensions less attractive, and the introduction of pension freedoms, which allow for cash to be taken out of the pot for investment, rather than buying an annuity, means there is also more freedom for investment in alternatives such as VCTs.

Variations in fundraising amounts can also be seen as responses to a series of legislative changes, notably in 2014, 2015 and 2018, introduced to ensure the focus of investment by VCTs is on early–stage companies that have the intention to grow and develop in the longer term.

Whilst the impacts of Covid-19 would have impacted towards the end of the 2019 to 2020 tax year, however, funds raised in 2020 to 2021 increased slightly despite covering the main pandemic period. Funds raised in tax year 2021 to 2022 have increased substantially. This may be, in part, the result of recovery from the Covid-19 pandemic. Additionally, the VCT market broadly follows the wider venture capital market and 2020 to 2021 was a record breaking year for the venture capital industry in terms of fundraising. In tax year 2022 to 2023, the slight decrease in amount of funds raised is likely a reflection of a slowdown in the wider venture capital industry, but the value of funds raised remain the second highest on record.

Figure 2: Number of VCTs raising and managing funds, 1995 to 1996 to 2022 to 2023

Figure 2 reports the number of VCTs raising and managing funds using the old series for tax year 1995 to 1996 to tax year 2018 to 2019. From tax year 2019 to 2020 onwards, funds raised are reported using the new series. The change in series is marked by the black vertical dashed line.

The number of Venture Capital Trusts (VCTs) raising funds in 2022 to 2023 has decreased to 44 from the previous year. In the past, the amount of funds raised by VCTs and the number of VCTs raising funds have been closely linked. However, this has been less evident in recent years where similar amounts of funds have been raised by a smaller number of large VCTs. This trend has continued in 2022 to 2023, with funds raised reaching the second highest level in 2022 to 2023 but the number of VCTs raising funds reducing by 1.

There has been a significant decrease in the amount raised by VCTs in 2022 to 2023 compared to the record breaking levels reached in 2021 to 2022. However, funds raised in 2022 to 2023 remain the second highest on record. With the number of VCTs raising funds decreasing in 2022 to 2023, this reflects the further concentration of the VCT market. As shown in Figure 2, Venture Capital Trusts (VCTs) have been merging over time to achieve economies of scale.

VCTs managing funds include VCTs which raised funds in the tax year and also those VCTs which managed the funds raised in previous years. The number of VCTs managing funds has decreased in 2022 to 2023 as a few VCTs have ceased to be active. Since 2010 to 2011, the number of VCTs managing funds has generally been decreasing, dropping to 48 in 2022 to 2023.

4. Investors claiming Income Tax relief and amounts invested

The amount of VCT investment on which Income Tax relief was claimed decreased by 6% in 2022 to 2023, compared to the previous year. The number of investors has broadly remained consistent increasing by just 1% to 26,260 in 2022 to 2023. This information only covers claims made through Self Assessment and will not cover investors making Income Tax relief claims through other systems (for example PAYE) or not making any claims.

Table 2a and Table 2b present the distribution of investors claiming Income Tax relief under the VCT scheme, and the amounts invested, respectively.

Total figures provided in Tables 2a and 2b on the amount of investment on which Income Tax relief was claimed are not directly comparable with the figures on the amount of investment received by VCTs in a tax year shown in Table 1, as some relief could be claimed outside Self Assessment, or not claimed at all.

4.1 Number of investors claiming VCT relief

Most investors tend to invest under £50,000 into VCT funds. The average amount invested by an individual in 2022 to 2023 was around £37,000.

Numbers have been rounded to the nearest 5. Totals may not sum due to rounding.

Table 2a: Number of investors claiming VCT relief by size of investment, 2020 to 2021 to 2022 to 2023

Investment band	2020-21	2021-22	2022-23
Up to £1,000	1,820	1,030	1,610
£1,000 to £2,500	1,175	1,080	1,380
£2,500 to £5,000	2,000	2,230	2,280
£5,000 to £10,000	3,425	4,470	4,450
£10,000 to £15,000	1,680	2,245	2,275
£15,000 to £20,000	1,775	2,510	2,555
£20,000 to £25,000	1,195	1,740	1,750
£25,000 to £50,000	3,175	4,915	4,665
£50,000 to £75,000	1,010	1,610	1,520
£75,000 to £100,000	910	1,465	1,385
£100,000 to £150,000	510	910	810
£150,000 to £200,000	950	1,740	1,585
Total	19,620	25,940	26,260

Figure 3: Distribution of the proportion of investors claiming VCT relief by size of investment, 2021 to 2022 to 2022 to 2023

In 2022 to 2023, there was a slight increase in the number of VCT investors compared to the previous year. It was thought that the Covid-19 pandemic may have acted to reduce investment towards the end of 2019 to 2020 as uncertainty increased across the economy. However, the increase in investment in 2020 to 2021 suggests Covid impacts may have been lower than expected, or they tempered what would have been a greater increase than is seen in the data in 2020 to 2021. This increase in investment was further shown in 2021 to 2022, with it being a record-breaking year for VCT investment. It is believed that this was due to a strong rebound from the Covid-19 pandemic as well as a particularly strong year for the wider venture capital industry. Whilst investment in 2022 to 2023 decreased compared to 2021 to 2022, indicating a slight slowdown in the venture capital market, it still remained a strong year for investment.

Figure 3 shows the distribution of investors claiming VCT relief grouped by size of investment. Around 80% of VCT investors claimed tax relief under the VCT scheme for an investment of £50,000 or less; the largest number being in the £25,000 to £50,000 group with 18% of the total and the £5,000 to £10,000 group with 17% of the total. In 2022 to 2023 the proportion of VCT investors in the higher investment size categories (above £25,000) decreased slightly compared to 2021 to 2022.

Figure 4: Number of investors claiming VCT relief via Self Assessment, 2004 to 2005 to 2022 to 2023

Figure 4 shows a time series of the number of investors who have claimed VCT relief from 2004 to 2005 to 2022 to 2023. The tax year 2018 to 2019 saw the largest number of investors since 2005 to 2006. This reflects the increase in funds raised seen in Figure 1 as a result of pension changes and the Patient Capital Review. The tax year 2021 to 2022 saw an increase in the number of investors compared with the previous year but is in line with the increase in investment into VCTs in the same year. The number of investors has remained broadly consistent, increasing by only 1% in tax year 2022 to 2023, meaning this tax year had the highest number of investors since 2004 to 2005.

4.2 Amounts invested by VCT investors

Table 2b shows a decrease of 6% in the amount of relief claimed by VCT investors in 2022 to 2023.

Amounts have been rounded to the nearest £5 million. Totals may not sum due to rounding.

Table 2b: Amount of investment on which VCT relief was claimed by size of investment, 2020 to 2021 to 2022 to 2023

Investment band	2020-21	2021-22	2022-23
Up to £1,000	<5	<5	<5
£1,000 to £2,500	<5	<5	<5
£2,500 to £5,000	10	10	10
£5,000 to £10,000	30	40	40
£10,000 to £15,000	20	30	30
£15,000 to £20,000	35	50	50
£20,000 to £25,000	30	40	40
£25,000 to £50,000	120	190	180
£50,000 to £75,000	60	100	95
£75,000 to £100,000	85	135	130
£100,000 to £150,000	65	115	100
£150,000 to £200,000	185	340	310
Total	645	1045	985

Figure 5: Distribution of the proportion of investment for which VCT relief was claimed by size of investment, 2021 to 2022 to 2022 to 2023

In Figure 5, we see that the largest category of investment by amount in 2022 to 2023 was investments between £150,000 to £200,000. More precisely, 31% of the total amount invested is accounted for by only 6% of investors.

Figure 6: Comparison of the amount of investment on which relief was claimed via Self Assessment and total funds raised (£ million), 2004 to 2005 to 2022 to 2023

Figure 6 shows that the amount of relief claimed and total funds raised by VCTs are largely consistent year on year. From tax year 2019 to 2020 onwards, funds raised are reported using the new series, the change in series is marked by the black vertical dashed line. In 2022 to 2023, around 98% of the total VCT investments were claimed through Self Assessment. The remaining amounts are assumed to be either claimed outside Self Assessment or not claimed at all. The tax year 2021 to 2022 is a record breaking year for the amount of investment Income Tax relief was claimed on, which is consistent with funds raised by VCTs in 2021 to 2022 reaching record breaking levels. In tax year 2022 to 2023 there is a decrease in the amount of relief claimed but this is consistent with the decrease in funds raised by VCTs in this tax year.

5. Contact

Statistical contacts: M Hindley and M Solonina; Venture Capital Statistics Team

Queries relating to investing in VCTs: Venture Capital Reliefs Team