16 Permanent endowment

Assets of a charity, including land and investments, may be ‘ring-fenced’ in the sense that the trustees are unable to expend them due to a restriction in the charity’s governing instrument. This is described as ‘permanent endowment’. A charity is to be treated as having a permanent endowment unless all its property can be spent on its charitable purposes without having to make a distinction between capital and income1. Permanent endowment may take two forms: one where capital is invested to secure an income for the charity and the other where the property is held specifically in

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