The figures reveal the VCT sector as a whole raised £542m in the 2016/17 tax year, 18% more than the £458m raised in the year previously.
It signalled the second-highest amount raised since the influx of 2004/5 when income tax relief was increased from 20% to 40% and investors paid in £779m, according to the Association of Investment Companies (AIC).
VCT assets under management to 5 April 2017 were £3.9bn, up on last year’s level of £3.6bn.
Ian Sayers, chief executive of the AIC, said VCT had become more attractive following pension restrictions.
He said: “These figures are a testament to the ongoing demand for VCTs by investors, boosted by the pensions restrictions and attractions of a tax-free yield, and the ability of managers to adapt to the new investment rules.
“But most importantly this is great news for UK smaller companies who are accessing the finance and expertise they need to grow.
“VCTs have an excellent track record of providing scale-up capital to smaller companies, creating growth, jobs and innovation.
“The growth of smaller companies is vital for the UK’s economic success and some of the businesses VCTs support develop into household names.”