Like everyone else, The Prince of Wales pays tax. And, like everyone else, he doesn’t get to choose the level of this tax. The Prince’s taxes are determined by the Government who apply exactly the same tax rules as they do for everyone else. There are no special concessions. In addition to income tax at the top rate, the Prince also pays VAT, Council Tax and National Insurance Contributions for his staff. Last year, these taxes totalled £5m. The Prince is sometimes referred to as paying these taxes voluntarily. This is because in 1993 both Her Majesty The Queen and The Prince of Wales volunteered to waive their exemption from taxes and be subject to the same tax rules as everyone else.
Some commentators have suggested that The Prince pays less tax than his staff. This is a miscalculation which does not take into account The Prince’s business expenses which, like everyone else, he is able to deduct before tax. This is no special arrangement; all taxpayers enjoy the same rights. The Prince pays all the taxes he is required to pay by law.
As for the Duchy of Cornwall, this is a private estate which funds The Prince of Wales and his family. The money generated by the Duchy becomes The Prince’s income, on which he pays the highest statutory level of income tax. The Duchy is not a corporation and therefore it is not subject to corporation tax. The Prince of Wales is not subject to Capital Gains Tax on any capital gains which The Duchy makes, because such gains must be reinvested for the benefit of the Crown and future Dukes of Cornwall.
We do not believe that The Duchy of Cornwall gains any significant competitive advantage over the bulk of other major property owners because of these tax arrangements.
