Venture Capital Trusts are gaining greater popularity among UK clients, according to a survey by Noble Group, an independent investment bank...

Venture Capital Trusts are gaining greater popularity among UK clients, according to a survey by Noble Group, an independent investment bank and VCT specialist. Research from Noble revealed that 88 per cent of UK independent financial advisers believe that increasing numbers of advisers are recommending VCTs to their clients. But more than half those surveyed say they are becoming increasingly confused by the number of VCTs on offer. Despite the increased adviser appetite for VCTs and the number of new launches, the study shows that four out of ten IFAs do not know enough about VCTs in order to recommend the right product to their clients. Noble estimates that the VCT market will grow to £400 million ($753.9 million) by the end of the UK tax year in April, compared with just £50 million the previous year. When asked to select which type of VCT will be most popular amongst investors this year, 50 per cent of advisers chose UK alternative stock market Aim VCTs, followed by generalist at 40 per cent and specialist at 10 per cent. Rule changes in the forthcoming UK budget should, according to Noble, result in a big increase in money flowing into the venture capital sector. The last budget allocated an extra 20 per cent income tax relief for investors, bringing the total level of income tax relief to 40 per cent. This change means that investing £1 in a VCT will cost the investor only 60 pence.