Legal News | 11.05.23
A Royally Taxing Weekend…
Whether you hosted a party to celebrate the King’s Coronation or turned a blind eye to the weekend’s festivities, there is one person on everyone’s mind at the moment: King Charles III.
Whilst King Charles’ crown, coronation concert and single white glove dominate headlines, one thing is not widely reported: tax.
You may be surprised to learn (or perhaps it is rather unsurprising!) that His Majesty’s Revenue and Customs treats King Charles rather differently. Since 1993, inheritance tax is not charged on assets passing ‘sovereign to sovereign’, meaning that assets passed from the late Queen Elizabeth II to King Charles were not subject to inheritance tax. Equally, under current rules, on King Charles’ death assets passing to Prince William will not be chargeable to inheritance tax.
As a reminder the usual inheritance tax rule is, broadly, that assets over the threshold of £325,000 passing to non-exempt beneficiaries trigger a charge to inheritance tax at 40%*.
King Charles also does not need to pay income tax or capital gains tax, however Queen Elizabeth opted to pay income tax on her income and King Charles confirmed that he would follow his mother’s lead.
If you are dealing with the estate of someone who has died and would like advice about inheritance tax, please contact us at wealth@wansbroughs.com and we would be happy to help you.
* There are various exemptions and allowances available in connection with inheritance tax – and you do not need to be the King to make use of those! Please get in touch if you would like advice on these.
