Cheapest way to access VCTs (and EIS)

tg99

For those of you who have invested in VCTs and or EIS on a non-advised basis, which broker do you generally find is the cheapest to buy them through? (Am looking to make some further investments before end of this tax year so thought I would check if there may now be cheaper brokers since I last invested. I have primarily used Clubfinance in the past.)

green_man

I had considered investing in Albion VCTs. But I was just going to invest direct.

tg99

green_man wrote: »

I had considered investing in Albion VCTs. But I was just going to invest direct.

I've not looked at or invested in Albion before but it is probably worth checking brokers like Clubfinance, Hargreaves, Bestinvest first as sometimes you get a rebate of part of the initial charge that way (though not always). I generally find discounts on initial charge from Clubfinance, Hargreaves, Bestinvest are the same but reason I tend to go via the former is that they tend to rebate some of the trail commission too (typically 75% of it paid effectively as cashback).

bigadaj

tg99 wrote: »

I've not looked at or invested in Albion before but it is probably worth checking brokers like Clubfinance, Hargreaves, Bestinvest first as sometimes you get a rebate of part of the initial charge that way (though not always). I generally find discounts on initial charge from Clubfinance, Hargreaves, Bestinvest are the same but reason I tend to go via the former is that they tend to rebate some of the trail commission too (typically 75% of it paid effectively as cashback).

Interesting point, seems to be one of the last areas that trail commission is till allowed. I put my first money into Albion a few months ago, through bestinvest as I hold a sipp with them and getting an initial discount was worthwhile given that the provider would hold onto it themselves otherwise. It did seem odd to be told it was being held off platform but I've just found a money observer article dated November 2014 that explains this, they suggest that interactive investor rebate all trail for a £30 fee, I'm currently putting minimums into a range of vcts so not worthwhile for me but maybe for bigger investors and I've learnt something to be a aware of going forward and will look at club finance in future to get that extra few quid back.

tg99

bigadaj wrote: »

Interesting point, seems to be one of the last areas that trail commission is till allowed. I put my first money into Albion a few months ago, through bestinvest as I hold a sipp with them and getting an initial discount was worthwhile given that the provider would hold onto it themselves otherwise. It did seem odd to be told it was being held off platform but I've just found a money observer article dated November 2014 that explains this, they suggest that interactive investor rebate all trail for a £30 fee, I'm currently putting minimums into a range of vcts so not worthwhile for me but maybe for bigger investors and I've learnt something to be a aware of going forward and will look at club finance in future to get that extra few quid back.

Useful info on iii, thanks, though like you say if you are doing minimums / small amounts then Clubfinance will typically work out cheaper given that trail is usually 0.5% pa so if iii rebates 100% of this as opposed to 75% with Club-finance the difference won't be enough to offset the £30 fee especially as the cashback on trail is taxable.

Just had quick look on iii website and they have Octopus Titan up which I hold and although has effective same net initial charge as if you went through Clubfinance it shows 0% of trail as being refunded (Clubfinance refund 75% of the 0.5% for 9 years) whereas for Albion it shows the full 0.4% (though does not show any initial discount for Albion). It does say on iii website that they refund all trail commission so seems to contradict this; also says at bottom of iiii vct table that they refund trail for up to 5 years so in the case of a VCT which pays trail for longer then not exactly sure what is arrangement for years 6 onwards.

For info, not looked at full T&C but seems though you might be able to transfer a VCT holding to Clubfinance via their Change of Agent service and then benefit from trail cashback:

http://clubfinance.co.uk/changeofagent.php

bigadaj

Thanks for that, I'll give it a go and look at club finance for future subscriptions.

Albion pay 0.4% trail commission for five years, so rebate isn't going to change my life but even £18 a year is worthwhile, though it does seem to be subject to tax from club finance website.

westy22

Also try Cavendish Online http://www.cavendishonline.co.uk/investments/other-products/vcts/who discount initial charges and also rebate trail commission for a one-off fee of £35 per transaction.

tg99

westy22 wrote: »

Also try Cavendish Online http://www.cavendishonline.co.uk/investments/other-products/vcts/who discount initial charges and also rebate trail commission for a one-off fee of £35 per transaction.

Thanks...just had a look and also worth adding that in the footnotes to the table Cavendish also state a £10 annual fee will be deducted from trail commission rebates due each year.

darren72

Sorry to reply to a thread that is over a year old, but this is the scenario I am currently in.

I have all my VCT investments with Clubfinance who are rebating 75% of their trail commissions.

I had never thought about using Interactive Investor for VCT's, so wondering whether this is going to be worthwhile instead.

Yes, they charge £30 but my last rebate cheque from Clubfinance was for over £500, so the difference is going to be quite large.

Does anyone know if Interactive Investor charge that fee to make them the agent, so they will receive the trail commissions going forward ?

Thanks in advance

Morphoton

I have used Chelsea for a number of years and have had no problems. I hold VCT's as paper certificates.
See: https://www.chelseafs.co.uk/products/vct/offer for current discounts of open VCT's.
I cannot comment on others but several discount brokers do offer discounts as well. IMHO it may be more advantageous to go with a discount broker than direct to the VCT provider.

darren72

Morphoton wrote: »

I have used Chelsea for a number of years and have had no problems. I hold VCT's as paper certificates.
See: https://www.chelseafs.co.uk/products/vct/offer for current discounts of open VCT's.

Thanks for your reply.

I can't see any mention of Chelsea rebating their ongoing trail commission though ?