Yahoo Finance King Charles III to avoid massive tax payment
King Charles III not only inherited the crown from Queen Elizabeth II but also a vast personal fortune.
However, he will not be forced to pay millions of dollars in inheritance tax thanks to a 1993 ruling.
The King inherited The Queen's $700 million personal fortune and, while UK law states a 40 per cent inheritance tax should be paid on assets that are passed down, the Royal Family is exempt.
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In 1993, the UK government ruled inheritance tax did not have to be paid on the transfer of assets from one sovereign to another.
At the time, Conservative prime minister John Major said it was necessary to protect the “independence of the monarchy”.
"The concerns that I would have … would be the danger of the assets of the monarchy being salami-sliced away by capital taxation through generations, thus changing the nature of the institution in a way that few people in this country would welcome,” Major told the House of Commons.
The Duchy of Lancaster estate, inherited by The King, made around $40 million (£24 million) and had assets worth more than $1.1 billion (£650 million) at the end of March this year.
The monarch is not legally obliged to pay any tax in the UK, but The Queen volunteered to pay income tax and capital gains tax in 1993.
King Charles III is expected to do the same after also volunteering to pay income tax on the Duchy of Cornwall estate, which has now been passed on to Prince William.
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