On April 9, 2021, Britain mourned the death of Prince Philip, Duke of Edinburgh. Prince Philip’s death marked the end of his 73 year marriage with Queen Elizabeth II. While much of Britain might have reflected on the consequences that Prince Philip’s death could have on the Crown, we naturally considered the tax implications that his death could have on his estate.

Though Canada does not have an inheritance tax, the United Kingdom (“UK”) has a significant inheritance tax rate of 40% on a Deceased’s estate which includes: property, money, and personal possessions. Members of the general public can avoid an inheritance tax if:

a) the value of their estate is below £325,000.00; or

b) any amount over £325,000.00 is bequeathed to their spouse, civil partner, a charity, or a community amateur sports club.

Additionally, members of the royal family can benefit from a unique legal clause that permits inheritance to pass from “sovereign to sovereign”, without triggering tax implications. This clause also allows an estate to pass from a sovereign to a reigning monarch without paying any tax. This provision, which was enacted in 1993, has previously been used by the Queen Mother when she left her £70 million estate to Queen Elizabeth II.

Prince Philip’s estate of approximately £24 million consisted of an extensive collection of paintings, books, private gifts, and investments portfolios. As a result of the clause noted above, Prince Philip would avoid any taxes if his entire estate was left to Queen Elizabeth II.

Thanks for reading – have a wonderful day,

Ian Hull & Tori Joseph