The Queen’s death has made her son king and a rich man – but where exactly is the cash coming from? | UK news

When the queen died, the estates crossed the line of succession along with the titles.

Her death made her eldest son an extremely wealthy man as well Kingwhile his heir secured a guaranteed income of over £20 million a year along with the title of Prince of Wales.

The royal family is funded by a messy collection of assets with roots in the Middle Ages that have been refined over time in deals with parliament, most recently in 2012.

Negotiated by George Osborne, it ensured revenue streams for the monarch, their heir and extended family, while the tax issue was largely voluntary.

The King’s main source of funding is the Sovereign Grant, calculated as 25% of the profits of the Crown Estate, a £15bn portfolio of commercial and residential property, agricultural and maritime land owned by the Crown rather than the individual monarch.

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In 2021-2022 it was worth £86.3m, of which £52m covered official travel, the cost of employing almost 500 members of the Royal Family and the maintenance of Occupied Royal Palaces. Buckingham Palace, Windsor Castle, Clarence House, St James’s Palace, Kensington Palace, Marlborough House Mews and Hampton Court Mews.

The remaining £34m was allocated to an ongoing ‘refit’ of Buckingham Palace. The Sovereign Grant rose from 15% of revenue to 25% in 2018 to cover the total cost of £369m over 10 years.

For the monarch, the value of the Sovereign Grant cannot be reduced even if revenue falls, although this may be unlikely given the UK’s ownership of much of the seabed, on which highly lucrative offshore wind licenses are to be granted the next years .

Local dignitaries give three cheers to King Charles III after an Accession Proclamation Ceremony at Windsor Castle, publicly declaring King Charles III as the new monarch.  Photo date: Sunday, September 11, 2022.
The Sovereign’s Grant, which King Charles will inherit, pays for staff and maintenance at palaces including Windsor

No inheritance tax

King Charles will also draw income from the Privy Purse, made up mainly of the net income of the Duchy of Lancaster, a £600m portfolio of land and property worth £22.3m in 2020-21.

The Queen used it to cover the cost of expenses incurred by other members of the royal family, including his siblings Prince Andrew, Princess Anne and Prince Edward, but not his heir.

The Queen also enjoyed a private fortune estimated at more than £350 million, including ownership of Balmoral and Sandringham. If, as is assumed, most of her fortune passes to King Charles, he will not have to pay inheritance tax on his new fortune.

Gifts from monarch to monarch are exempt from death duties, although bequests to her other children or other individuals or entities will be taxed.

A swan is seen with Kensington Palace in the background, in London, Britain, June 28, 2021. REUTERS/Henry Nicholls
Kensington Palace

There is no will for this will

We will never know the details, however, because the sovereign’s will remains sealed, the only will in the realm that does not need to be probated.

The Sovereign Grant is not taxable, but since 1993 the Queen has voluntarily paid income tax on income from the Duchy of Lancaster not used for official purposes. King Charles has yet to confirm that he will do the same.

As heir to the throne, Prince Williamhis wife and children will now benefit from the Duchy of Cornwall, a £1 billion portfolio of farmland, property and investments that includes the Oval Cricket Ground & the Isles of Scilly.

Voluntary income tax

The estate paid the now-king £23m last financial year, profits that are exempt from corporation and capital gains tax and subject to voluntary income tax on the net surplus after unspecified deductions.

The Duke and Duchess of Sussex leave the National Service of Thanksgiving at St Paul's Cathedral, London, on the second day of Queen Elizabeth II's Platinum Jubilee celebrations.  Photo date: Friday, June 3, 2022.

Having decided to leave the working royal stable, the Duke and Duchess of Sussex They now rely on the exchange of talent and their remaining titles, with income from various media deals, including a £20 million book deal.

In a profound irony, Torture and Meghan signed a $100 million deal with Netflix, which owes much of its dominance of the streaming market to The Crown, a drama that did for the Windsors what Shakespeare did for the Plantagenets and costs more to produce per series from the annual government grant.

None of these income streams cover the cost of royal security, widely estimated at more than £100m a year and borne by the taxpayer, or the price of royal visits which are often funded by local authorities.

The royal family doesn’t pay for their celebrations either. The Treasury provided an additional £28 million to fund the recent Platinum Jubilee, the majority of which was spent on a four-day deterioration in central London.

Even with a conservative annual bill of £250m, supporters of the monarchy argue they are not paying more.

Does tourism pay the bill?

Tourism is commonly cited as their biggest asset, yet revenue from the five royal palaces open to the public was just £9.4m last year and just above £20m before COVID, and none are in the top 20 popular attractions in Britain. With 1.5 million visitors, Windsor Castle was ranked just 23rd, behind Chester Zoo, Stonehenge and Tate Modern.

Contrast this with the appeal of Versailles, the palace of the long-standing French monarchy, which attracts almost 10 million visitors a year, and it suggests that UK palaces are not underperforming.

Less quantifiable, but almost certainly more valuable, is the brand value the Windsors bring to the UK. They give British diplomats soft power and its businesses a unique selling point.

The Chateau de Versailles (Palace of Versailles) is seen on the day of its reopening in Versailles, near Paris, following the outbreak of the coronavirus disease (COVID-19) in France, June 6, 2020. REUTERS/Charles Platiau
Paris’ Chateau de Versailles beats Britain’s palaces in the tourism numbers game

“Don’t mess with the monarchy”

One FTSE 100 executive, recently back from an investor tour of the US, remarked: “Don’t mess with the monarchy. After Brexit, and with all the dysfunctional politics, it’s the only thing that makes the rest of the world still work in Britain.”

That glow may even be enhanced by the Queen’s death and the continued display of pride and proclamation that the past week has brought.

Marriages, divorces, miscarriages and disgrace

She has been mourned around the world, with messages of goodwill from Beijing to Paris, and her funeral will take its place in the dramatic arc of marriages, divorces, separations and infamy that have captured global attention across the globe. during her reign.

King Charles, rising at the height of a cost-of-living crisis and without the depth of goodwill enjoyed by his mother, will face greater scrutiny of his household and spending, notably how he uses at least eight palaces and private residences now at his disposal and how many of the family will benefit.

Any CEO will tell you that stability is the greatest asset of any business and the Queen’s death can only bring uncertainty, but the company’s income under Charles III is at least guaranteed.

And as the Elizabethan era ends with the first full state funeral of the color TV era, the world will still be watching.

Whether the King can maintain the value of the Windsor share and public consent to the financial settlement will be more a matter of politics and philosophy than economics.


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