The Monarch is not legally liable to pay income tax, capital gains tax or inheritance tax because the relevant enactments do not apply to the Crown. The same is true for the income from the Duchy of Cornwall which is paid to The Prince of Wales. Since 1993, The Monarch and the Prince of Wales have voluntarily paid tax. This is set out in a Memorandum of Understanding on Royal Taxation, updated July 2023.
The King is not liable to pay tax on the Sovereign Grant as it covers official expenditure only and, under the arrangements in the Memorandum, tax would not be due.
Other key points to note:
the King voluntarily pays income and capital gains tax, alongside inheritance tax to the extent described in paragraphs 1.10 and 1.11 in the Memorandum. Tax is also paid on The King’s Privy Purse income (which includes income received from the Duchy of Lancaster) to the extent that it is not used for official purposes
other members of the Royal Family are fully liable to tax in the normal way. The cost of their official duties is allowed against tax
https://www.gov.uk/government/publications/sovereign-grant-act-2011-guidance/sovereign-grant-act-2011-guidance
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