King Charles will not have to pay inheritance tax on the Duchy of Lancaster property he inherited from the Queen, due to a rule allowing assets to be passed from one sovereign to another. Charles automatically inherited the estate, the monarch’s main source of income, while his eldest son, Prince William, inherited the Duchy of Cornwall worth more than $1 billion previously owned by his father. The new king will avoid inheritance tax on an estate worth more than $750 million because of a rule introduced by the UK government in 1993 to guard against wiping out the royal family’s assets if two monarchs died within a short period of time. The news was reported. The provision was first implemented in 2002 when the Queen Mother bequeathed an estate worth about $80 million to the Queen, including a collection of Faberge eggs. The clause means members of the royal family do not have to pay a 40% levy on properties worth more than £325,000 ($377,000) to help protect her assets. The estate brought in 24 million pounds ($27 million) last year, according to its financial records, and the King is now entitled to its income. He had assets worth more than 650 million pounds ($754 million) at the end of March this year, the duchy’s website said. A law passed in 1702 prohibits the monarch from selling any of the assets. The Queen began voluntarily paying income and capital gains tax on wealth in 1993, and Charles may decide to follow suit. The Duchy of Lancaster’s estate, founded in the 13th century, consists of “commercial, agricultural and residential” properties, including a portfolio of financial investments, according to its website. Its five agricultural units, or Surveys, cover around 18,000 hectares of land in England and Wales. The Foreshore Survey covers approximately 36,000 hectares from the River Mersey, on which the city of Liverpool is built, to Barrow-in-Furness in northern England. It also consists of the Mineral Survey, which includes limestone and sandstone quarries from south Wales to North Yorkshire. However, most of its income comes from Urban Survey, which includes extensive commercial property interests in central London such as the Savoy Hotel. The Savoy Hotel in central London belongs to the Duchy of Lancaster. John Keeble/Getty Images Balmoral and Sandringham residences are owned by the royal family, while most of the other properties they use, such as Buckingham Palace and Windsor Castle, are part of the Crown Estate.
The Duchy of Lancaster has been contacted for comment.