Financial investment – Trustees can invest money to generate income for their charity to spend on its aims. For example, buying a property to get a rental income. These investments need to get the best possible financial return for the level of risk the trustees consider acceptable.

Programme related investment – This involves investment to meet a charity’s aims. This means any financial return made is a secondary consideration and does not required the trustees to get the best possible return. Any benefit to private individuals such as investment advisers must be necessary, reasonable and in the interests of your charity; and you must be able to end the investment if it no longer meets your charity’s aims

Mixed motive investments – Investments which are neither completely financial nor programme related

If you are planning to invest, you should read the Charity Commission’s detailed guidance (CC14) on investing charity funds which sets out the legal requirements in more detail.

From a tax perspective, HMRC has published detailed guidance on approved charitable investments and loans