Downing Income VCT 3

Closing date extended to 29 June 2012

The closing date for our VCTs has been extended to midday on 29 June 2012.

 

Introduction

Downing Income VCT 3 is a Generalist VCT seeking to take advantage of the growth potential of attractive businesses currently available because of the lack of alternative sources of finance.

It is targeting a regular income of 7.1% p.a. tax-free on net of tax cost and will allow investors to claim 30% income tax relief on their subscription, subject to circumstances and a five year holding period.

 

How to apply

In order to invest please read the Prospectus and then complete the Application Form and return it to Downing:

Investor Guide, Reviews & Suitability Paragraphs

 

Method of payment for applications

Payment for applications can be made by cheque, made payable to "Downing Income VCT 3 plc", or by electronic bank transfer, using the details below:

  • Downing Income VCT 3 plc
  • Account No.: 00608158
  • Sort code: 16-01-09
  • Bank: Royal Bank of Scotland, 119 - 121 Victoria Street, London SW1E 6RA
  • Please put your (investor's) name as the payment reference.
 

Key points

  • 30% income tax relief: on the amount subscribed on up to £200,000 per tax year, subject to circumstances and five year holding period.

  • Regular income: 7.1% p.a. tax-free target on net of tax cost. Target tax-free dividend of 5p per year comprises 2.5p expected in January and September each year. First dividend expected September 2012. Please note the level and dates of dividends are objectives and are not guaranteed.

  • Fair exit policy: the VCT has a policy of buying back shares at nil discount to NAV for the first five years and from year eight onwards. Buybacks in years six and seven will be undertaken at a 15% and 7.5% discount to NAV respectively. Policy subject to sufficient financial resources and regulations.
 

Investment strategy

It is intended that the majority of the investments will be made in investee companies that own substantial assets and the VCT will seek to take a charge over these assets in order to reduce risk. The funds raised under the Offer will be invested over three years and it is anticipated that by 31 March 2015 the asset allocation will be as follows:

  • Qualifying Investments (80%): will be split between lower growth investments (75%) in companies that own substantial assets and higher growth investments (25%) that will target capital gains rather than high levels of income. Higher growth investments will be higher risk than the lower growth investments.
  • Non-Qualifying Investments (20%): will comprise cash deposits and short-term loans to businesses, typically secured by a charge over assets held by the borrower.
 

Closing dates and subscription amounts

Closing dates

  • Midday on 29 June 2012 for the 2012/13 tax year

Subscription amounts

  • Minimum individual subscription: £5,000
  • Maximum individual subscription: £200,000
 

Claiming income tax relief on your VCT investment

To claim your 30% income tax relief, please follow the steps provided in our guide: 

 

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