Next steps in your Octopus VCT journey
Are you considering what your investment options are? Let us help you decide what’s next.
VCT shares need to be held for the minimum five-year holding period to retain the upfront income tax benefits. If you’ve met this minimum holding period and are considering your next steps, you have a few options. We always recommend talking to a financial adviser before making any investment decisions. We can’t offer you financial advice, but if you have any questions, please call us on 0800 316 2295.
Hold or add to your investment
If you choose to continue holding onto your VCT shares, there’s no need for you to do anything. Your investment will continue to target tax-free dividends and growth.
To add to your investment, contact your financial adviser or apply online.
Sell and reinvest in another VCT
When you sell your VCT shares, you’re able to reinvest immediately into a different Octopus VCT*. Your investment would continue to target tax-free dividends and growth, while investing in some of the UK’s most promising tech-enabled businesses.
*Please note, if you sell shares in a VCT within six months of buying new shares in the same VCT, you won’t qualify for income tax relief on the new shares. However, if you sell shares in one VCT and buy shares in a different Octopus VCT (including any other VCT), you might be eligible for immediate income tax relief on the new shares.
If you’d like to add to your existing investment, or reinvest into another VCT, you’ll receive a 1% loyalty discount as appreciation for your continued support.
You can see our open VCTs below. We always recommend you talk to a financial adviser before making investment decisions.
Sell your VCT shares
If you’ve decided to sell your VCT shares, please read our guide below to understand how.
Risks to bear in mind
Capital at risk
The value of 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 may change
Tax treatment depends on individual circumstances and may change in the future. Tax reliefs depend on the VCT maintaining its qualifying status.
Five-year minimum holding period
Investors need to hold shares for a minimum of five years. If you decide to sell your shares before then, you will be required to repay to HM Revenue & Customs (HMRC) any upfront income tax relief you’ve claimed.
Volatility and liquidity
VCTs invest in smaller companies that are often not listed on the main market of the London Stock Exchange. Investments in smaller companies can fall or rise in value much more sharply than shares in larger, more established companies. They can also be harder to sell.
Reminder of the benefits
Income tax relief
Investors can claim upfront tax relief equal to 30% of their investment on the first £200,000 per annum invested. Dividends and capital gains are also tax-free.
Tax-free dividends
The tax-free dividends paid by a VCT can provide a supplementary income, which could be useful, especially if investors are approaching or in retirement.
Support UK growth businesses
Investing in a VCT means investors are helping innovative smaller companies to create jobs, prosperity and economic growth across the UK.
Portfolio diversification
VCTs can help diversify an investor’s overall portfolio by giving them access to companies they may not otherwise hold.