Define: Venture Capital Trust

UK Accounting Glossary

Definition: Venture Capital Trust


Quick Summary of Venture Capital Trust


An investment trust that provides risk capital for smaller unlisted trading companies.




What is the dictionary definition of Venture Capital Trust?

Dictionary Definition


A Venture Capital Trust (VCT) is a investment trust that provides risk capital for smaller unlisted trading companies.


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Full Definition of Venture Capital Trust


A Venture Capital Trust (VCT) is a investment trust that provides risk capital for smaller unlisted trading companies.

The trust managers accept sums of money from investors who wish for a share in the profits of the trust. This form of investment is relatively high risk but does however gain certain tax advantages in the UK, in that any profits are free of capital gains tax and that income is untaxed.

They also have additional advantages in that £200,000 may be invested in any given year and that 30% of any investment in a VCT can be claimed back from previously paid tax, provided that the VCT is held for 5 years.

By investing a taxable gain in a VCT that is held for 5 years, payment of the Capital gains tax may be deferred until the VCT investment is sold (and the annual exemptions from capital gains tax can be carried forward).


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Definition Sources


Definitions for Venture Capital Trust are sourced/syndicated from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • BusinessDictionary.com
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 4th May 2019.