Royal Wealth and Finances 1: Ending 2022

[Warren]

It's the tax authorities who calaculate the amount of death duties on an estate, not the public, and the tax authorities would have access to the details of the estate's value.

 

[muriel]

It's the tax authorities who calaculate the amount of death duties on an estate, not the public, and the tax authorities would have access to the details of the estate's value.

Quite right.

I believe the contents of all wills shold be kept private, with only the beneficiaries being made aware of the contents.

 

[Menarue]

Aren´t all will available to the public? Does this mean that only the royal family´s are not? I am not sure about this but I will be told if I am wrong very quickly no doubt.

 

[Skydragon]

It's the tax authorities who calculate the amount of death duties on an estate, not the public, and the tax authorities would have access to the details of the estate's value.

No it is not, it is the Executors or accountants appointed by the Executors who calculate the amount of IT due, with the figure being approved or rejected by HM Revenue & Customs.

http://www.hmrc.gov.uk/inheritancetax/how-to-value-estate.htm

Valuing the estate of someone who has died is one of the first things to do if you’re acting as the executor or personal representative for that estate. You normally can’t get access to the assets in the estate until you’ve received a grant of probate (or confirmation in Scotland).
You need to know the estate’s worth to fill in the probate application forms and show whether or not Inheritance Tax is due.

 

[Skydragon]

Aren´t all will available to the public? Does this mean that only the royal family´s are not? I am not sure about this but I will be told if I am wrong very quickly no doubt.

Princess Margaret and Queen Elizabeth the Queen Mothers were ordered, by HM to be sealed.

 

[Royal Fan]

Will they remain sealed though?

 

[Iluvbertie]

Will they remain sealed though?

Isn't that the point of the commission - to decide whether or not they should remain sealed?

So at this stage is we really don't know, but I suspect that they will have to become public.

 

[Warren]

...it is the Executors or accountants appointed by the Executors who calculate the amount of IT due, with the figure being approved or rejected by HM Revenue & Customs.

I stand corrected. Nonetheless, a will which states "I leave all my worldly possessions to my husband..." or "I bequeath my entire estate to my daughter..." or "my estate is to be divided equally between my three surviving children..." gives no indication as to what the estate entails and in these examples is irrelevant to the assessment of the estate's total value in regard to any duty payable.

My personal experience as Executor this time last year, which I assume is similar to that in the UK, was that I provided the value of the various components of my late partner's estate to the Solicitor. Some amounts required verification and some didn't, but the will itself gave no indication of either the contents or the value of the estate. The Application for Probate contained both the original copy of the will together with a list of the estimated or known value of the assets (called "property"). These documents were retained by the Registrar General and I received copies stamped and impressed with the government seal when probate was granted. It is these documents that I am assuming are covered by the special royal provision to be kept private.

I should add that we are fortunate in Australia as death duties were abolished many years ago.

 

[muriel]

That said, your broader point remains that it is for the tax authorities to be satisifed that the inheritance tax has been adequately computed, and not the court of the Daily Mail!

 

[Skydragon]

Nonetheless, a will which states "I leave all my worldly possessions to my husband..." or "I bequeath my entire estate to my daughter..." or "my estate is to be divided equally between my three surviving children..." gives no indication as to what the estate entails and in these examples is irrelevant to the assessment of the estate's total value in regard to any duty payable. .... snipped.... It is these documents that I am assuming are covered by the special royal provision to be kept private.

I should add that we are fortunate in Australia as death duties were abolished many years ago.

I am sorry to hear of your loss.

Accountants & Solicitors handled the estate of my first husband and my father, as they along with myself (for my 1st husband) and other family members were executors. I handled the estate of my son.

All items here have to be shown at their value and any large monetary recipients are then advised of any Capital Gains Taxes they should pay. All this after IT is taken. Both were available in the entirety and details of both were in the public domain, along with the value of the estate and the value of all bequests made. The exceptions to the published details were 'wish lists' that were left to the discretion of the executors, but whose value was still included within the valuation, (which for the calculation of death duties, is the value on the day of death). Therefore it was available knowledge that X received £xxx from the estate.

It is the full disclosure of the value of the estate, including bequests, that I believe they are saying should be published. Many that are published do say Lord X left a total of £XXX, to his eldest son, Lord P, with a £XXX trust fund set up for his wife, Lady X and then go on to show the other bequests (to children and staff).


The main point from The Telegraph article and the MP proposing it, is that the civil list payments could be abolished if it is shown that HM leaves a private fortune of 3 billion pounds+ to Charles.

 

[muriel]

I am sorry to hear of how you have such a good understanding of how wills and probate work.

I also could not agree more with you on the central issue here, which is whether the "value" of the estate should be made public. The Royal Family will clearly not want a key element of their finances being made public through this route, given the wider issue of public finances to support the royals in their work.

Separate from all of this, I do not understand why the contents of any wills need to be made public!

 

[Warren]

The main point from The Telegraph article and the MP proposing it, is that the civil list payments could be abolished if it is shown that HM leaves a private fortune of 3 billion pounds+ to Charles.

OK, we are back on firmer ground with this one. Once again the Civil List is being (deliberately?) confused with the private wealth of the Sovereign. The Civil List is designed to cover the costs of the Sovereign in the performance of his/her state duties, including staff, visits, engagements, entertainment etc. I would liken the MP's proposal to applying an income and assets test to an incoming Prime Minister and saying "Tough. We've decided you're rich enough to pay for the upkeep of your office staff at Number 10 out of your own pocket; if you want to entertain a visiting dignitary at Chequers then pay for it yourself; next time you visit the President of the United States you can pay your own airfare. Phones, postage and internet? Pay up by the end of the month. No expenses for you!"

 

[Skydragon]

In our dreams! A salary of perhaps £100,000 for HM, she does have the Duchy funds to add to the kitty?

I do however feel that HM's should abide by the same rules regarding wills, as their subjects. The closing of Margaret and QEQM's wills has left many questions.

 

[HRHofNothing]

The main point from The Telegraph article and the MP proposing it, is that the civil list payments could be abolished if it is shown that HM leaves a private fortune of 3 billion pounds+ to Charles.

That is the craziest thing I have ever heard. The Civil List and to a certain extent the Privy Purse are payments made to the Soverign Head of State of the United Kingdom as salary for the job she performs and for the running of the "executive" branch of government.

This is like saying that if Bill Gates manages to get himself elected President of the United States, not only will he NOT get a salary, he will have to use his personal wealth to pay for the running, maintenance and upkeep of the White House, Camp David, Air Force One, Marine One etc. etc.

 

[Mermaid1962]

I'm so sorry to learn that you experienced the death of your son, Skydragon. I can't imagine anything worse for a parent.

I handled the estate of my son.

 

[Skydragon]

Crown Estate plans to build a huge off-shore wind farm on England's only World Heritage Site have infuriated locals, who say they were not consulted.

Crown Estate did not tell locals about huge off-shore windfarm - Telegraph

 

[HRH Bella]

HM Elizabeth will keep the will away from the people it is a privet matter and being that she is a Soverign I believe she does not pay taxes .

 

[iakynthi]

I'm not sure if I should post this here.I just read that QEII lost 37M pounds because of the financial crisis and I wanted to share this with you.Does anyone know more about this?It would be interesting to know if all this amount of money was lost in cash,for example.

 

[Warren]

...I believe she does not pay taxes.

From the British Monarchy website:

The Queen pays tax.
In 1992, The Queen volunteered to pay income tax and capital gains tax, and since 1993 her personal income has been taxable as for any other taxpayer.
The Queen has always been subject to Value Added Tax and pays local rates on a voluntary basis.

I just read that QEII lost 37M pounds because of the financial crisis... Does anyone know more about this? It would be interesting to know if all this amount of money was lost in cash,for example.

If what you read couldn't give details of what the "37M pounds" represented it sounds like someone is plucking figures out of the air or it is pure supposition.
Assuming HM has a shares portfolio, the value would have fallen over the past twelve months. Very few people would have detailed knowledge of her private investments and those that do wouldn't be talking to the press about it.

 

[Skydragon]

Royal Family are winners from the Budget

The Royal Family has emerged as among the few winners from the Budget after the Prince of Wales was granted a tax break worth hundreds of thousands of pounds.

Royal Family are winners from the Budget - Telegraph

 

[Warren]

What the fine print says is this:

"Official expenditure incurred by their Royal Highnesses Prince William of Wales and Prince Henry of Wales in the course of their official duties and met by His Royal Highness The Prince of Wales' income from the Duchy of Cornwall, or by Her Majesty the Queen from the Privy Purse, may be deducted in arriving at the amount of income which is charged to income tax."

 

[Iluvbertie]

Can I just clarify one point?

Here in Australia if a business employs people, rents/leases space to carry out the work etc it is a tax deduction.

Is that the same in the UK?

If so then why shouldn't the Duchy of Cornwall claim the expenses involved in employing some people to work for them?

I don't understand.

I know that many British people object to spending any money on the royal family and would like the monarch to fund themselves but still work for the country and I understand that some will see this as Charles claiming something more than is allowed but what I am trying to do is simply establish whether or not another business in Britain is able to claim the expenses associated with running that business as a tax deduction as happens here.

 

[muriel]

Completely valid point. It is much the same in the UK - reasonable expenses incurred in the pursuit of the "business" are tax deductable, subject to some checks and balances.

My sense is that here this was more a point of clarification than actually a change in the position. As the boys are not the Prince of Wales, and in effect, not directly eligible to use the income from the Duchy of Cornwall (which is for the use of the Prince of Wales), I suspect this clarification from the Treasury would have been required. If somebody knows more, I would love to hear about it.

 

[Skydragon]

Here in Australia if a business employs people, rents/leases space to carry out the work etc it is a tax deduction.

Is that the same in the UK?.

Similar, but there are strict rules governing what can and can't normally be claimed, which is why it is seen as a concession for Charles.

Allowable Expenses and Deductions - The Tax Guide (UK)

"In most instances, expenditure can be counted as allowable expenses if it was required solely in order to acquire income"; clearly not the case here.

 

[muriel]

Similar, but there are strict rules governing what can and can't normally be claimed, which is why it is seen as a concession for Charles.

Allowable Expenses and Deductions - The Tax Guide (UK)

"In most instances, expenditure can be counted as allowable expenses if it was required solely in order to acquire income"; clearly not the case here.

.... though the Tax Guide probably does not apply to the case of Royal Finances as they are subject to specific rules agreed with the Treasury.

 

[Menarue]

I remember reading once (sorry can´t remember where) that the biggest concession is that it was the Queen who volunteered to pay tax and fixed the percentage to be paid, if this is untrue please correct me.
IMO not many people in the world can tell the tax authorities how much they are willing to pay. Not that I am grudging her, I would do the same if possible.

 

[Iluvbertie]

I remember reading once (sorry can´t remember where) that the biggest concession is that it was the Queen who volunteered to pay tax and fixed the percentage to be paid, if this is untrue please correct me.
IMO not many people in the world can tell the tax authorities how much they are willing to pay. Not that I am grudging her, I would do the same if possible.

I know that Charles voluntarily paid 50% of his income in tax until he married Diana and then it was reduced to 33%.

The Queen started paying tax voluntarily in 1992, partly I believe at the suggestion of Charles. As to how much she pays I have no idea.

 

[Skydragon]

.... though the Tax Guide probably does not apply to the case of Royal Finances as they are subject to specific rules agreed with the Treasury.

Which is exactly the point, special 'rules', that are not permissible for ordinary businesses or taxpayers, have been applied for Charles and in these times of recession, it can only damage the monarchy.

 

[muriel]

Which is exactly the point, special 'rules', that are not permissible for ordinary businesses or taxpayers, have been applied for Charles and in these times of recession, it can only damage the monarchy.

Based on what has been disclosed, there is nothing new in the "special" rules, other than this slight clarification. We are going over old ground here, but if you take away the "special" rules, HM and the PoW would be paying no tax at all.

 

[Skydragon]

perhaps you didn't have time to read the article -

In a little-noticed supplementary document to the Budget, Alistair Darling, the Chancellor, announced that the taxpayer would pick up the cost of running an office recently created to support Princes William and Harry. The future King, who funds a six-strong team for his sons out of his £16 million-a-year income from the Duchy of Cornwall, will now be able to deduct their salaries from his annual tax return

So, not clarification.