Monday, July 22, 2013

British Royal Baby Billionaire

As I write this post, most of the world is holding their collective breath waiting for the royal baby to arrive.  The Brits and much of the world are fixated on the fact that the next royal heir is about to enter the world.  I, on the other hand, keep thinking about how filthy rich this baby already is!  Do the royals pay inheritance tax?  What will the baby inherit?!

According to data from Wealth-X, an organization that tracks wealth information for ultra high net worth individuals, it is estimated that the royal baby will inherit approximately £1 billion (or about $1.5 billion U.S.) based on the estimated fortunes of other family members.  Queen Elizabeth II’s fortune is estimated at $660 million, with about $58 million in annual income.  And these figures don’t even include the crown jewels or other family heirlooms.  Even young William is estimated to be worth at least $20 million.

I was also surprised to learn that until 2011, if the Duke and Duchess of Cambridge gave birth to a girl, she may not have inherited the throne.  With Queen Elizabeth II having recently celebrated her diamond jubilee and 60 years on the throne, this very recent change to the law shocked me.  The leaders of the 16 Commonwealth countries actually had to agree to amend the succession laws to allow succession to the throne based only on birth order, and so now a daughter can inherit the throne, and not only when there are no sons (as was the previous rule). Now, whether a boy or a girl, the royal baby will be third in line to the throne.

Second surprise of the day: the monarchy is EXEMPT from inheritance tax (at a whopping 40% rate)! Apparently the Queen made an agreement in 1993 that leaves her exempt from this otherwise steep tax. Convenient.

Finally, just because I think it is entertaining (and I feel like I am writing part of Game of Thrones), the royal baby will inherit the following obscure items

The Dutchy of Lancaster, 46,000 acres of land with various structures worth about $300 million and earning about $13 million per year in revenue;

The use of numerous royal establishments, including Buckingham Palace, Clarence House, Hampton Court Mews and Paddocks, Kensington Palace, Marlborough House Mews, St. James’s Palace, and Windsor Castle;

The use of the crown jewels (tiara party, anyone??); and

Fishes Royal, or any sea life captured within 3 miles of shore.  Seriously.  This is based on a statute from the 1300s, and technically could still apply. What baby doesn’t want a dolphin for a pet?

This plan is slightly different from my parents’ estate plan, but then I guess I didn’t grow up in Buckingham Palace!

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