There are no tax exemptions for any member other than some exceptions where HMRC grants leniency. So the question that arises here in your mind is who pays taxes on UK royals and how is it different from regular tax implications? It is totally understandable to wonder about these queries. We all are well aware of the facts about the royal family members and their power is an institute in the UK. However, what you might don’t know is that the tax implications are for some of the royal family members as well. This sounds quite surprising to many of you of course. According to HMRC whether you belong to the royal family or any other family in the UK.
Before going into these details it is imperative to learn that there is no denying the benefits that come with being a family member of the royal family. Personal butlers, lavish property, crown jewels, and corgis are some of the common examples. However, the rules that are implemented for the royal family members are also strict than they are for other residents of the UK. The rules on tax are the same and they will have to pay taxes that are implemented according to HMRC. However, the case of filing the self-assessment tax returns is different with the Queen and other family members. Of course, they hire professionals for this purpose. This post will cover everything that you need to know about how the royal family gets taxed, and what is the tax amount they pay in a tax year. Let us dive further into the details.
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How do the Royal Family Get Taxed?
In simple words, yes the UK royal family members have their tax implications and they pay it actually. However, the scenario becomes a little more complicated than you can imagine in this case. We can not deny the fact that the UK royals and their family members are not taxed in the way other UK residents are being taxed. This is due to the fact that the status of royal family embers is not like that of regular British citizens. This explains that the way of getting them under the tax obligation is also different than in other British chintzes.
What is the Sovereign Grant?
It is imperative to mention the details of the Sovereign Grant and lots of roles in the royal family. The Queen and the royal family members are funded in a way which is known as Sovereign Grant. Now every tax year the Sovereign Grant is issued to the members of the royal family from HMRC. The amount of profits that is earned from the Crown Estate revenue, a part of this amount is given to them. The percentage of this share is 25%.
Moreover, we can take the instance of the amount of Crown Estate’s revenue which is £343.5 million in one tax year. The Sovereign Grant will be an amount of £85.9 million as 25 % of the total amount earned. The president and the Chancellor of the Exchequer review the details associated with this matter after every five years.
How are the Royals Taxed Differently?
As we know that the royals are under the obligation to fulfil the duties of the Crown Estate, so they are not associated with any other jobs like the British citizens. Moreover, it is imperative to know here that the ownership of the Crown Estate is not with any royal family member or even with the government. It is known to be associated with hereditary possessions of the Sovereign in the right of the crown. Now the profits that are earned through the Crown Estate are directly submitted to HMRC. HMRC is under the obligation to submit the fund share of the royal family to them.
Don’t Pay Any Tax or Not?
Any of the above-discussed things must not be confused with any kind of assumptions related to the royal members not paying the tax. However, the money received in the form of a Sovereign Grant is not taxed. The personal income of the Queen and other family members is taxed and too under high tax rates. Council tax, VAT, and road tax are a few common examples of the taxes that the royal family members will have to pay. If we get into the details of the amount of tax, only the tax of Buckingham Palace is taxed with an amount of £1,500 in one tax year even after having the kind of size.
How About Other Taxes?
Now there are some royal family members who are inclined toward paying the tax voluntarily. This includes the tax kinds capital gains tax and even the income tax. The Queen is on the top of the list to pay the tax on a volunteer basis and pay the tax at higher rates as well. This happens even after the fact that Queen is not legally required to pay this kind of tax, however, she chooses to pay the tax. The mandatory tax payment is also exempted for the Queen. You might not find anything in common with the family members of the Royals and Queen. This is because of the fact that a regular citizen in the UK does not own the place and the unique jewels and assets. However, the tax rates are just the same way implemented to the royals as they do to any other citizen.
The Bottom Line
Now that you have gathered a fair amount of information about who pays taxes on UK royals, we can bring the discussion towards wrapping up. In the case of a regular citizen earning more amount than a certain limit, the rate of tax will be as higher as they are for the family members of royals. However, there is no denying the tax payments as the royals usually do it voluntarily as well as discussed earlier. We hope these few minutes of reading have helped to develop a better understanding of the UK tax implications on the royal family members.
Disclaimer: All the information provided in this article on who pays taxes on UK royals, including all the texts and graphics, is general in nature. It does not intend to disregard any of the professional advice.