- Home
- News, Articles & Reviews
We are hiring! Please click here to join our growing magazine delivery team in Gloucestershire!
Areas
Legal & Finance
Archive
Royal tax planning
All Areas > Legal & Finance > Money Matters
Author: Roger Downes, Posted: Friday, 23rd April 2021, 09:00
Let me start by paying my respects publicly to the Royal Family on the recent sad passing of the Duke of Edinburgh. Whilst there are many conversations taking place across the country regarding different aspects of Prince Philip’s passing, Money Matters’ attention drifted to the question of what happens to inheritance tax in this case.
We all know that the Prince’s funeral was restricted to thirty people under Covid laws, so are there special rules for the Royal Family or are they subject to the same taxes as the rest of us?
Well, the answer is both. At a basic level, the Duke of Edinburgh’s estate is subject to the same rules as anyone else’s, but then there are ‘special conditions’ to preserve the wealth of the sovereign. Whether we ever learn how much Prince Philip was ‘worth’ remains to be seen and most of his ‘wealth’ will be tied up in his wife’s position, of course. But various reports have the estate at £10 million plus, and maybe even double that – enough to create tax planning issues, that’s for sure.
Straightforward and effective
The first step in that tax planning is simple and as available to you and me as it is to a senior member of the Royal Family. He leaves it all to his wife and there is no tax payable at all. That’s probably what will happen as it is straightforward and effective from a tax point of view, it creates no public outrage as it’s not favourable treatment, and it ‘keeps it in the family’.
Could the Prince have done anything else and, if so, what would the tax impact be? He could leave money to charity tax efficiently. Prince Philip was a keen supporter of many charities and maybe he would’ve had problems deciding which ones to support, but, with a few detailed limitations, money left to charity is exempt from inheritance tax. You should always take professional advice if you are thinking of doing so.
Money left directly in his will to other members of the family is not tax-effective, save for his lifetime allowance of £325,000, which probably only scratches the surface of his net worth. It is unlikely he’s done that, partly for reasons of tax and tradition, but also maybe because he wouldn’t then have to decide who gets it and who doesn’t.
But TV interviews are one of those ‘other conversations taking place across the country’ and are not the domain of Money Matters.
Rest in peace, Your Royal Highness.Copyright © 2024 The Local Answer Limited.
Unauthorized use and/or duplication of this material without express and written permission from this site's author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to The Local Answer Limited and thelocalanswer.co.uk with appropriate and specific direction to the original content.More articles you may be interested in...
© 2024 The Local Answer Limited - Registered in England and Wales - Company No. 06929408
Unit H, Churchill Industrial Estate, Churchill Road, Leckhampton, Cheltenham, GL53 7EG - VAT Registration No. 975613000You are leaving the TLA website...
You are now leaving the TLA website and are going to a website that is not operated by us. The Local Answer are not responsible for the content or availability of linked sites, and cannot accept liability if the linked site has been compromised and contains unsuitable images or other content. If you wish to proceed, please click the "Continue" button below: