Prince Charles's £700m estate accused of tax avoidance

[Tony Gosling]

Prince Charles's £700m estate accused of tax avoidance
The duchy of Cornwall gave the prince an income 
of £18m last year, but says it is not subject to paying corporation tax
http://www.theguardian.com/uk/2012/dec/14/prince-charles-estate-tax-avoidance
  Prince Charles. As well as the duchy income, 
last year the prince received £2.2m in grants 
from the taxpayer to pay for his travel by 
private jet, helicopter and train, and the upkeep of Clarence House.
Friday 14 December 2012 20.13 GMT
Last modified on Monday 11 January 2016 03.25 GMT
HM Revenue & Customs has been asked to 
investigate alleged tax avoidance by Prince Charles's £700m hereditary estate.
The duchy of Cornwall last year provided Charles 
with an income of £18m and HMRC's anti-avoidance 
group is now being asked to examine its 
non-payment of corporation tax following a 
potentially significant court ruling on its legal status.
The issue has been raised by an accountant 
investigating the tax affairs of the duchy – an 
agricultural, commercial and residential landowner.
He has analysed the impact of a judicial ruling 
handed down last year. Anti-monarchy campaigners 
claim it shows the duchy is running "a well-entrenched tax avoidance scheme".
The duchy insists it "is not subject to 
corporation tax as it is not a separate legal 
entity for tax purposes". But John Angel, 
principal judge at the information rights 
tribunal, ruled last December it was a separate legal body to the prince.
Accountants now believe the ruling could leave 
the duchy exposed to the 24% levy on profits 
other organisations must pay. Any change to its 
tax status could result in a cut to the prince's income.
Republic, the campaign for an elected head of 
state, has asked HMRC's anti-avoidance team to 
investigate whether the ruling means the duchy is 
now "using a highly questionable interpretation 
of its legal status as a means of avoiding corporation tax obligations".
A spokesman for HMRC said it would evaluate the 
information and "take appropriate action". There 
is no suggestion any law has been breached. 
Clarence House strongly denies claims of avoidance.
The move comes as the House of Commons public 
accounts committee, which earlier this month 
criticised Starbucks, Google and Amazon for their 
"immoral" decisions to avoid paying more 
corporation tax, prepares to hold a hearing next 
year into the royal finances. As well as duchy 
income, last year Charles received £2.2m in 
grants from the taxpayer to pay for his travel by 
private jet, helicopter and train and the upkeep of Clarence House.

The duchy owns 53,000 hectares of land in 23 
counties, including Prince Charles's 
Gloucestershire home of Highgrove. It has 
provided incomes to successive Princes of Wales 
since the 14th century. The assertion that the 
estate is inseparable from Charles has allowed 
him to use its gross profits to fund private and 
official spending including 26 valets, gardeners 
and farm staff. In the past five years he has 
received more than £86m from the arrangement.
But when Angel was tasked with deciding if the 
duchy should publish information about its 
environmental impact, he ruled it must be 
considered a separate legal body to the prince 
because of "the differentiation of the duchy and 
duke in commercial and tax matters as well as 
under legislation and the contractual behaviour of the duchy".


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