venture capital Archives - Financial Planning in Surrey

What’s Your Opinion About the Budget?

Dominic Thomas
Nov 2025 • 4 min read

What’s Your Opinion About the Budget?

There was a palpable sense of adolescent schoolchildren during the Budget. The team here couldn’t quite fathom the petulant behaviour of adults. It didn’t help women’s causes that the three main characters seemed like characters from St Trinian’s, Grange Hill and Mean Girls. You can decide who was who.

The short version – nothing much happened. The Budget is often an exercise in shuffling the deck attempting to please the public who want more for less, the media who want sensationalism and the markets which want certainty. If we are honest the “greater good” should prioritise the planet, society and the economy in that order, but little is achieved without money, so the reverse generally holds.

A main problem that any Government has is that roughly 10% of all taxes ends up going towards servicing interest on loans the UK has received, (it’s now almost as much as the entire spend on education). This includes paying you your interest on your UK Government Bonds and Gilts or National Savings. As it is just the interest (not actually repaying the debt) market responses to a Budget can increase this considerably.

I’m not sure that I can really comment on the Budget without getting ‘political’, but … I think it’s a pity that:

Young people attempting to buy a home were not given any good news
The Landlord tax will likely only increase rents, which seems entirely counter-productive
Tax relief on pensions could have been simplified to a single rate for all
Working taxes are punishing work and are overly complicated. If you want to get people spending, raise the personal allowance and give it to everyone irrespective of income. I’d be bold with this
NI needs to be sorted properly and with gumption, employers have seen enormous increases in staffing costs, which results in both inflation and reduced new hires as well as possibly redundancies. I don’t know what the solution is, but I think I would amalgamate it into income tax
Small farms haven’t had any relief of note, these people feed us and look after the countryside and are being squeezed on their own margins. I think the £5m exemption would seem fairer
There is about £11bn of uncollected corporation tax that is hidden offshore by multinationals. This can and should be collected
I’m curious to know how EV mileage will be monitored
We need to encourage entrepreneurs who take a risk to start a business and employ people in good jobs with good salaries which generate tax. So the cut in reliefs isn’t helpful
Clearly tax simplification isn’t that simple

To me, tax is a bit like someone who plants a tree for future generations to sit in its shade, whilst never doing so themselves. It’s a price paid to the future.

I don’t pretend to have the answers and it is very easy to criticise a Government. I rewatched the disastrous Kwasi Kwarteng Budget of September 2022. I would imagine that most people would actually agree with his policies to reduce income taxes and welcome many of his proposals at the time, but we are beholden to the servicing of debt on the Bond market. All Chancellors are subject to the wisdom of Proverbs 22:7 “The borrower is a slave to the lender”. [For your interest – it is generally believed that King Solomon wrote the Book of Proverbs.]

Anyway, perhaps you have some thoughts of your own?

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Money & climate change

Dominic Thomas
May 2025 • 4 min read

Money & climate change

There are an awful lot of changes coming as to how the financial services sector can describe ESG investment solutions. We are all aware of the greenwashing that has gone on … if you are an enormous company (or even a small one) simply paying into some carbon offset scheme doesn’t really address the issue of your own actions. Equally, a so-called environmental company that makes electric cars may be run by an individual who, well, let’s say isn’t on my list of people to emulate in any way.

A sector that is high risk (you really can see all of your money disappear) is the startup, venture capital space. This is not for the faint-hearted. The sector is often looked to as the potential saviour of the planet and innovators for tomorrow. Well, we can hope that’s the case …

Here in the UK, we have Government incentives to step outside of the normal ‘investment world’ (which we call the retail investment sector) and consider a portion of your portfolio for venture capital. What has been concerning me over the last couple of years is that this and the previous Government seem to think allowing mainstream pensions to invest in this space is wise. It really isn’t. This is only for those who are willing to stake a relatively small part of their wealth in the hope of excellent returns and some serious do-gooding, with an understanding that it may also go horribly wrong.

As someone who generally advises you to have very low cost portfolios, tracking markets and not attempting to second guess the future; here I split off into a different character and acknowledge that the benefits of venture capital might be worth consideration for some of you.

EIS, SEIS and VCTs all have tax incentives … the Government adds 30%, 50% and 30% respectively to your investment. Though how it works is that you get this back as a tax refund. There are some conditions to maintaining this of course, but these are reasonable. Most investments are early stage and realistically need holding for 7-10 years as a minimum.

The pots of these investments are generally very small. Sometimes no more than half a dozen companies, rather than the multiple thousands that are in your regular portfolio (which reduces risk). The chance of failure is high, but the potential rewards can be significantly better than anything the retail markets might achieve.

Those who specialise, for example, in solutions to climate change include an EIS Fund by One Capital. I recently met with their team. I am not suggesting here that you invest in this, I want to use it as an example of the type of investment, nothing more – if you want relevant specific advice get in touch.

One of their holdings is with Bristol-based Kelpi, who make “plastic like” food containers from kelp and do the job, but without the plastic. You can have a look for yourself at their website here: https://www.kelpi.net/.

All investment managers of this type start with what they call ‘deal flow’ which is usually hundreds of people with ideas pitching them for money to develop and take their service or product to market. This is then whittled down by the investment managers to a manageable number before some deep dive due diligence is conducted. Eventually they may be left with a handful of companies that they believe have good prospects that suit their particular fund outlook.

Great ideas often fail to make great businesses; you need the right people. So this is an occasion where the managers and their hands-on approach and experience are all rather vital … and expensive. EIS, VCT and SEIS all have much higher expenses and management fees than anything you are currently invested into.

Anyway, this sort of stuff is really only for those who have used up the normal allowance options (ISAs and Pensions), but if you would like to know more and perhaps have a specific focus for a small element of your money (say on climate change) then please get in touch. The tax year end is a factor in the process.

Just for interest, here is a short video by One Planet.

Video link here

Please note that I am NOT advising you to invest in this fund, you have understood that by now, this is simply an example of what is available. Investment should always be in line with your circumstances, values and goals as closely as possible.

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