We mentioned in our previous article the top four most hated taxes in the UK, and inheritance tax is one of them.
Because British law stipulates that when people die and leave their relatives with assets exceeding a certain amount, they will need to pay 40% inheritance tax.
King Charles III automatically inherited part of the estate of the Elizabeth II, the clause will protect the royal wealth.
The estate was worth at least £652 million, and the old terms allowed the new king to avoid a million-pound estate tax.
How Much Will King Charles III Inherit?
Although a newspaper has previously estimated the Queen’s private wealth as high as £370 million, how much King Charles will receive will not be made public.
According to regulations, monarchs’ wills are sealed decades after their death.
The only certainty at the moment is that the new king will at least take over the Queen’s private estate, the Duchy of Lancaster.
The asset will be worth more than £650m and generate £24m in revenue.
The monarchy is exempt from inheritance tax
The old treaty we mentioned at the beginning was not written into law, but it served as a “Memorandum of Understanding on Royal Taxation” between the government and the royal family.
For the record, some royal assets are held solely by the Queen as a sovereign rather than personally owned.
Therefore, no estate tax is required on non-personally owned assets.
These assets also include official assets such as the famous Buckingham Palace, the Royal Collection of Paintings and various works of art.
They are jointly owned by the royal family, not individual property.
Does Private Property Have to Pay Inheritance Tax?
There is no estate tax on any property that King Charles inherits, not even from Prince Philip.
“Inheritance tax will not be paid on a gift from one sovereign to the next,” the memorandum of agreement reads.
Likewise, “there is no tax on the transfer of assets to the monarch upon the death of the former monarch’s spouse”.
However, anyone other than the next monarch is subject to estate tax on assets inherited from previous monarchs.
Due to the peculiarities of the royal family, some assets are not only used officially but also privately.
The royal family needs sufficient private resources to be able to play a traditional role in national life.
Are monarchs legally required to pay taxes?
First, the monarchy is not legally required to pay income tax, capital gains tax or inheritance tax at all.
Second, the income tax and capital gains tax paid by the Queen over the years is voluntary.
Therefore, including this move, even the iconic smile of a lifetime of service to the nation endears the Queen to much love.