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New Royal grandfather’s taxes are under scrutiny

July 23, 2013


Prince Charles via Wikimedia Commons 2011Prince Charles is no doubt enjoying his new status as a grandfather.

But the king in waiting (and waiting and waiting) has more than just the still-unnamed baby prince on his mind.

Prince Charles' tax situation is under scrutiny.

Parliament's public accounts committee wants to know why the Duchy of Cornwall, Charles' hereditary estate, pays no
corporate tax or capital gains tax.

The estate's financial statement for the year ending March 31 reported a value of £19 million, almost $29 million U.S. That was an increase of just more than 4 percent over the previous year.

Charles himself does pay taxes on earnings he receives from the Duchy, a voluntary practice by the Royal Family since 1993.

Last year, he reported a tax payment of £4.4 million, or around $6.8 million U.S. That bill would have been higher if the Prince of Wales hadn't offset almost £11 million (almost $17 million U.S.) against official expenditures.

Calls for formalized royal taxation: Tax and anti-monarchy groups
argue that tax breaks for the duchy and a voluntarily tax for the
prince are unjustified. The duchy, they say, is in fact a company and should pay taxes as such.

"If it looks like a duck and quacks like a duck and swims like a duck,
you would sort of assume it's a duck," said Labour Party member Nick Smith in questioning the prince's senior aide William Nye. "Given the Duchy of Cornwall looks
and behaves like a corporation with income from complex investments,
and quacks like a corporation given its council including the great and
the good from banking, on the face of it many of my constituents would
say the Duchy should pay corporation tax and capital gains tax."

Nye naturally disagreed.

"The Duchy is a very unusual organization," said Nye. "It's a private estate, and
it's not a corporation … there is a council, but it's an advisory council, it
advises the Duke of Cornwall. … Essentially it is a set of properties
that belong to the Duke of Cornwall, the fact that it's a large set of
properties and worth a lot of money doesn't per se make it a corporation."

And as for taxes, which the Queen and the Prince of Wales have paid of their own volition since 1993 since income from the Duchy of Cornwall is technically exempt from tax, Nye told lawmakers, "they don’t choose how much tax to pay; they choose to pay tax
in the normal way."

Will the tax-the-crown groups get their way? Perhaps eventually.

But there are plenty of other nonpayers to look at, too.

The examination of the Royal Family's tax situation is the latest in a string of investigations into British tax avoidance by some of the world's biggest global
corporations, including Amazon, Google and Starbucks.

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TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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