Inheritance tax is paid by people who have inherited money or property after the death of another person. People in the UK face a 40 percent tax bill for any assets valued at over £325,000. According to the Sunday Times, the Queen had a net worth of £365million.
But the King is exempt from this tax bill, according to UK Government documents.
King Charles III has inherited much of the Queen’s multi-million pound estate.
The Royal Family owns 1.4 percent of land in England.
The Government explains: “Some assets are held by the Queen as Sovereign rather than as a private individual.
“They are not sold to provide income or capital for the personal use of the Queen and pass from one Sovereign to the next.
“The official residences, the Royal Archives, the Royal Collection of paintings and other works of art and other assets held by the Queen in right of the Crown fall into this category.
“It would clearly be inappropriate for inheritance tax to be paid in respect of such assets.”
But the King will also be exempt from the tax when it comes to private assets.
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This is because “the Monarchy as an institution needs sufficient private resources to enable it to continue to perform its traditional role in national life”.
The Government also says the King is exempt from inheritance tax in order to preserve “a degree of financial independence from the Government of the day.”
However, anyone other than King Charles who has inherited private assets from the Queen will have to pay inheritance tax.
The Government outlines: “In relation to assets which can properly be regarded as private, the arrangements provide that inheritance tax will not be paid on gifts of bequests from one sovereign to the next, but will be payable on gifts and bequests to anyone else.
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“Tax will also not be payable on assets passing to the Sovereign on the death of a consort of a former Sovereign.
“The reasons for not taxing assets passing to the next Sovereign are that private assets such as Sandringham and moral have official as well as private use, and that the Monarchy as an institution needs sufficient private resources to enable it to continue to perform its traditional role in national life, and to have a degree of financial independence from the Government of the day.”
However, as commentator Rob Nunn pointed out on Twitter, the Royal Family’s private real estate investment holdings — estimated to be north of £12billion in total value — are historically handed over to the UK Government.
Mr Nunn noted that the new monarch “surrenders his entire estate to the UK Govt in return for a Sovereign grant equivalent to 33 percent of his estate’s income”, which “effectively [makes] him the highest taxpayer in the UK.”
King Charles formally surrendered all hereditary revenues, including the crown estate, to the United Kingdom government at a ceremony at St. James’s Palace on Saturday.
He will instead begin receiving a sovereign grant funding his official duties as monarch.