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Meghan Markle and Prince Harry plan to become 'financially independent' upon stepping back from royal life. Here's how much the British royal family is worth.
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Meghan
Markle and Prince
Harry are taking a "step back" from their positions as
members of the royal family and moving toward becoming
"financially independent," the couple announced in an Instagram
post on Wednesday
Most of the British monarchy's wealth comes from
inherited lands and investments, butBritish
taxpayers also support the royal family through a "sovereign
grant" issued by the treasury.
Meghan Markle and Prince Harry are taking a "step back" as
members of the British royal family, the couple announced in an
Instagram
post on Wednesday.
Going forward, the Duke and Duchess of Sussex will split their
time between the UK and North America, and they plan to start a
"new charitable entity," according to the post. They also said
they will work to become "financially independent."
Most of the British monarchy's wealth comes from inherited lands
and investments, but British taxpayers also support the royal
family through a "sovereign grant" issued by the treasury. In
2019, the grant total amounted to $104 million.
Here's how much the British royal family is worth now - and how
they acquired their millions.
Meghan Markle and Prince Harry are stepping back from royal duties and moving toward becoming "financially independent," the couple announced in an Instagram post.
The Duke and
Duchess of Sussex said they plan to be financially
independent and will continue to "fully support Her Majesty The
Queen" in this new phase.
The couple also said they will split their time between the UK
and North America going forward, and they plan to start a "new
charitable entity."
Together, the Duke
and Duchess have an estimated $30 million personal fortune
that derives from Prince Harry's inheritance from Princess Diana,
his annual allowance from Prince Charles, and Markle's income
from starring in the USA Network drama "Suits," as well as
endorsement deals and sponsorships, Business Insider's Tanza
Loudenback reported.
In becoming financially independent, the Duke and Duchess of Sussex could be cutting themselves off from a massive sum of centuries-old money. The British royal family is worth an estimated $88 billion, according to Forbes.
A report by business consultancy firm Brand Finance
calculates the
worth of the British Monarchy each year by adding up the
crown's concrete assets as well as the family brand's "value
impact" and other less tangible contributions.
The $88 billion estimate does not include the personal finances
of the Queen and her relatives as private citizens.
Forbes also reports that the
British monarchy "contributes nearly £1.8 billion ($2.4 billion)
to the UK economy" annually, including £550 million ($720
million) in tourism.
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British taxpayers support the monarchy in the form of a lump sum issued to the queen each year by the treasury that's known as the sovereign grant. In 2019, it amounted to $104 million.
The sovereign grant is meant to cover the expenses Queen
Elizabeth II racks up in her official duties as monarch,
including travel, entertaining, and property maintenance,
according to The Mirror.
In 2019, the amount of the grant
was £49.3 million ($63 million), according to Fortune.
Combined with an additional grant of £32.9 million ($42 million)
given to put toward the costs of restoring Buckingham Palace, the
total came to £82.2 million ($104 million).
The sovereign grant typically comes out to 15% of the annual
profit of the Crown Estates, which owns most of Regent Street as
well as thousands of acres of land, but in 2017 it jumped from
15% to 25% in order to pay for Buckingham
Palace renovations.
The amount granted to the monarch cannot decrease from the
previous year, even if the Crown Estate fares poorly. The
National Audit Office has free reign to audit the grant.
The arrangement hasn't always been without snarls. The
grant came under review in 2015, essentially because the
queen was making too much money.
Queen Elizabeth II also has her own personal fortune — and she paid income tax for the first time after a fire devastated her favorite castle in 1992.
"The sovereign is not legally liable for income, capital-gains or
inheritance tax," according to the Economist.
That expectation changed after one of the queen's favorite
residences, Windsor Castle, was devastated in a 1992 fire,
according to the Daily Mail.
The fire sparked controversy over who would foot the bill for the
damages. Ultimately, Queen Elizabeth began paying taxes on her
income. According to the BBC, she was
the first monarch to pay taxes since the 1930s.
The queen also makes "voluntary payments to the UK tax authority
HM Revenue and Customs" in lieu of capital gains tax and
inheritance tax, Business Insider previously
reported.
The sovereign grant itself is tax-exempt.
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The Crown — not Queen Elizabeth herself — holds many luxurious residences and priceless objects in trust.
The queen herself doesn't personally own national treasures like
the Crown Jewels or the Tower of London.
Such national treasures are part of the royal collection, which the monarch holds in
trust for the nation. The collection is made up of thousands of
paintings, tapestries, pieces of furniture, photographs, and
other objects, spread out between numerous royal residences.
Certain palaces, like Buckingham Palace and Windsor Castle, are
also held in trust.
Queen Elizabeth II does personally own certain items in the
collection, including an immense royal stamp collection her father King
George V passed down to her. She also privately owns the $65
million country house, Sandringham House, and the $140 million
Scottish estate Balmoral Castle, according to Fortune.
Queen Elizabeth and Prince Charles derive income from two duchies with medieval roots — which were both caught up in the Paradise Papers leak.
Queen Elizabeth and her son and heir Prince Charles were caught
up in a financial firestorm when their names appeared in the Paradise Papers.
The Duchy of Lancaster - a private estate initially established
for John of Gaunt, the younger son of King Edward III - has been
handed down from monarch to monarch since 1399. Funds from the
duchy pour into the Crown's Privy Purse - or private income.
The Washington Post reported
that $12 million of the queen's private money from this duchy was
invested offshore, in Bermuda and the Cayman Islands.
Prince Charles of Wales also came under fire as a result of the
news.
The 680-year-old Duchy of Cornwall is inherited by the eldest son
of the reigning monarch. Back in 2007, the duchy bought $113,500
of shares in Sustainable Forestry Management Ltd. The
Bermuda-based company stood to benefit from a change in climate
change policy.
The BBC reported Prince
Charles advocated for the change "... and his estate, the Duchy
of Cornwall, tripled its investment in Sustainable Forestry in
the space of a year."
Spokespeople from both duchies denied wrongdoing and pointed to
the fact that both royals voluntarily pay taxes on their incomes.
But the revelations still stirred controversy. Labour party
leader Jeremy Corbyn told the
Telegraph, "Anyone that is putting money into tax havens in
order to avoid taxation in Britain, and obviously investigations
have to take place, should do two things - not just apologize for
it but also recognize what it does to our society."
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The Crown hasn't always been under such scrutiny in regards to its finances, amassing enormous wealth over the centuries, largely through land acquisitions and conquest.
The Crown's wealth has historically flowed from inherited
properties acquired through centuries of conquest, forfeiture,
and purchases.
The practice of establishing Crown lands - or land belonging to
the monarch - dates all the way back to the Norman conquest.
Different rulers have gained and lost land over the years, as the
cost of governance grew over time.
When King George III took the throne in 1760, the way royal
finances were managed underwent a major change. According to
the royal family's official website,
Parliament began to pay for the entirety of the "Civil List" -
government expenditures and royal household costs traditionally
handled by the monarch. In exchange, Parliament would receive the
"hereditary revenues" of the king's Crown Estate.
While the Crown Estate is "owned by the monarch for the duration
of their reign," it is not their private property and "cannot be
sold by the monarch, nor do revenues from it belong to the
monarch," according to the Crown Estate's
website.
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