When the Queen died, fortune passed to her successor along with the titles.
Her death made her eldest son an extremely wealthy man as well as Kingwhile his heir has a guaranteed income of more than £20m a year along with the title of Prince of Wales.
The Royal Family is funded by a vast collection of assets with medieval roots, refined over time in dealings with parliament, most recently in 2012.
Negotiated by George Osbourne, it guarantees a source of income for the monarch, their heirs and the wider family, while dropping the tax question is largely voluntary.
The King’s main source of funding is the Sovereign Grant, which is calculated at 25% of the Royal Family’s profits, a £15 billion portfolio of commercial and residential properties, farmland and sea owned by the King. property of the Crown, not of the monarch personally.
In 2021-22, it is worth £86.3 million, of which £52 million covers official travel, the cost of hiring nearly 500 members of the Royal Family and maintenance of the occupied Royal Palaces. close; Buckingham Palace, Windsor Castle, Clarence House, St James’s Palace, Kensington Palace, Marlborough Mews House and Hampton Court Mews.
The remaining £34 million is allocated for the ongoing “re-maintenance” of Buckingham Palace. Sovereign Grants were increased from 15% of revenue to 25% in 2018 to cover total costs of £369 million over 10 years.
For the monarch’s convenience, the value of the Sovereign’s Endowment cannot be reduced even if revenues fall, although that may be unlikely given the UK’s ownership of much of the seabed, on which hugely lucrative licenses for offshore wind turbines will be issued in the coming years .
No inheritance tax
King Charles will also derive income from the Secret Wallet, which is primarily made up of the net sales of Duchy of Lancaster, a £600 million portfolio of land and real estate properties for 2020-21. .
The Queen used the money to cover expenses incurred by other members of the Royal Family including her siblings Prince Andrew, Princess Anne and Prince Edward, but not heirs. your.
The Queen also enjoys an estimated private fortune of more than £350 million, including ownership of Balmoral and Sandringham. If, as is assumed, most of her estate goes to King Charles, then he will not have to pay inheritance tax on her new fortune.
Gifts from the monarch to the monarch are exempt from death duty, although the estate to her other children, or any other individual or entity, will be taxed.
There is no probate of this will
However, we will never know the details, because the sovereign’s will remains sealed, the only will in the kingdom that is not through probate.
Sovereignty Allowances are not taxed, but since 1993, Queen has voluntarily paid income tax on revenue from the Duchy of Lancaster that is not used for official purposes. King Charles has yet to confirm he will do the same.
As heir to the throne, Prince WilliamHis wife and children will now benefit from Duchy of Cornwall, a £1 billion portfolio of farmland, property and investments including Oval Baseball & Island Scilly.
Voluntary income tax
The estate paid to the current King £23 million in the last financial year, earnings are exempt from corporate and capital gains tax, and subject only to voluntary income tax on the surplus. net after unspecified deductions.
After deciding to leave the active royal stables, the Duke and Duchess of Sussex now rely on trade-offs for their remaining talent and titles, with income from various media deals including a £20m book deal.
In a profound irony, Harry and Meghan signed a reported $100 million deal with Netflix, given The Crown’s dominance in the streaming market, a script that did to the Windsors what Shakespeare did to the Plantagenets and the cost of production. each series more than the annual Sovereign Allowance.
None of these sources of income include the cost of royal security, which is widely estimated to be more than £100 million a year and is paid for by taxpayers, or the price of royal visits usually paid by the government. locally funded.
The royal family also doesn’t pay for its own celebrations. The Treasury set aside an additional £28 million to fund the recent Platinum Year, much of which was spent on four days of pageants in central London.
Even with a conservative annual bill of £250m, monarchy advocates argue they don’t just pay their way.
Does travel hit the bill?
Tourism is often seen as their biggest gain, yet revenue from the five royal palaces that opened their doors to the public was just £9.4m last year and just exceeded £20m pre-COVID and nowhere. Which is in the top 20 most visited famous attractions in England. With 1.5 million visitors, Windsor Castle is ranked 23rd, behind Chester Zoo, Stonehenge and Tate Modern.
Compare that to the allure of Versailles, the palace of the long-standing French monarchy, which attracts nearly 10 million visitors a year, and it shows that the palaces of the United Kingdom are underperforming.
Less quantifiable, but almost certainly more precious, is the brand value the Windsors bring to the UK. They lent their soft power to British diplomats and British businesses a unique selling point.
‘Don’t mess with the monarchy’
One FTSE 100 executive, recently returning from an investor tour of the United States, commented: “Don’t mess with the monarchy. After Brexit, and with all the tangled politics chaos, it’s the only thing the rest of the world thinks still works England.”
That light may even be enhanced by the Queen’s departure and the continued display of pageantry and manifesto the past week has brought.
Weddings, divorces, defections and disgrace
She has been mourned around the world, with messages of goodwill from Beijing to Paris, and her funeral will take place in a dramatic arc of weddings, divorces, defections and infamy. attracted global attention during her reign.
King Charles, at the height of his cost of living crisis and not as deeply well-intentioned as his mother, will face closer scrutiny over his family and spending, at least how he would use at least eight palaces and private houses now. available to him, and how many people in the family will benefit.
Every CEO will tell you stability is any business’ greatest asset, and the Queen’s death can’t help but bring uncertainty, but The Firm’s earnings under Charles III are at least guaranteed.
And as the Elizabethan era ends with the first state funeral of the color TV era, the world will still be watching.
Whether the King can maintain the value of Windsor shares and public consent to a financial settlement, will be a question of politics and philosophy rather than economics.