How the Royal Family Make Money—and Keep the Lights on at Buckingham Palace
The royal family is paid through a mix of public and private funds.
The Queen's net worth fell to $460 million in 2020, according to UK newspaper The Sunday Times.
Ahead of The Crown season 4, here's how the royal family actually makes money—including Harry and Meghan.
In The Crown season 3, episode 4, Tobias Menzies's Prince Philip gives an interview to NBC's Meet the Press. In it, he addresses the royals' rumored money struggles and the fact that the queen hadn't had a "pay raise" in almost 18 years (this interview actually took place in November of 1969, two years after his mother, Princess Alice, moved into Buckingham Palace).
In the real-life program, host Lawrence Spivak cited a London news report and asked Philip, "it goes on to detail the very high cost that the royal family must sustain on an allowance of one million one hundred thousand dollars a year. Is that creating an awkward situation?"
"Very," Prince Philip replied. "We go into the red next year." As to whether they'd had to shutter any of their estates, Philip said, "No, not altogether. We've closed down...well for instance, the queen had a small yacht that she had to sell. And I should probably have to give up polo fairly soon." These remarks provoked ill will from the British public, who failed to share his view that selling a yacht counts as a financial hardship.
The question of how the royals get their money resurfaced in November 2019, following unconfirmed reports that Prince Andrew, Queen Elizabeth's second-youngest son, would forego his "salary" of roughly $300,000 after stepping back from public duties for the foreseeable future. It arose once more in the months leading up to Harry and Meghan's official exit as senior members of the royal family in March 2020.
So what are the royal family's salaries, how do they earn them, and where does the money come from? And what's the Queen's net worth? Here's what we know about how the royals make money, including how much it costs the average taxpayer in England.
How much does Britain pay the royal family?
As with most things royals-related, the answer is complicated. The royal family is paid through a mix of public and private money—that's on top of net worths that include inherited wealth, a significant real estate portfolio, and other assets. Most of Queen Elizabeth II, Prince Philip, and their children's annual income and expenses are paid through three sources: the public Sovereign Grant, and the private Duchies of Cornwall and Lancaster.
The Sovereign Grant
Since 2012, the queen's official duties, and the costs involved in maintaining the occupied palaces, have been paid for by a government-administered annual lump sum called the Sovereign Grant. According to the British monarchy's official site, "funding for the Sovereign Grant comes from a percentage of the profits of the Crown Estate revenue." The Crown Estate, as CNN Money explains, can be roughly defined as "a collection of U.K. properties and farms that generate hundreds of millions of pounds each year."
These lands were first surrendered by George III back in 1760, to be managed by the Treasury going forward. The Crown Estate technically belongs to the reigning monarch, but as their site clarifies, "it is not the private property of the monarch —it cannot be sold by the monarch, nor do revenues from it belong to the monarch." It's presently overseen by an independent organization's board.
In the 2018-2019 fiscal year, the total Sovereign Grant amount was 82.2 million pounds (that's nearly $106 million in American dollars). Neither the queen nor her family are raking that total in, though: 32.9 million pounds of that were allotted for "Reservicing of Buckingham Palace," and it also covers the royal family's duty-related travel expenses, payroll, and other staff costs, and literally keeping the lights on.
The Sovereign Grant replaced the Civil List and three Grants-in-Aid for travel, communications, and palace maintenance. Until it was abolished in 2012, the Civil List was an annual amount the government used to give the queen to cover her duties as Head of State and Head of the Commonwealth, and Grants-in-Aid from government departments that previously paid for royal duties-related travel and upkeep of royal residencies.
The Privy Purse and the Duchy of Lancaster
If the Sovereign Grant is an expense account of sorts, the Privy Purse includes the queen's actual income (her estates are also considered included in the Privy Purse). The queen's income is drawn from the Duchy of Lancaster, which is a portfolio of land, property and assets held in trust for the reigning sovereign. In 2018, the Privy Purse received nearly 20 million pounds (about 26 million U.S. dollars) in income from the Duchy of Lancaster.
While the Queen and Prince Philip use part of this money to cover additional expenses, Elizabeth also draws from it to pay her children Prince Andrew, Prince Edward, and Princess Anne a salary for their schedule of royal engagements around the world.
The Duchy of Cornwall
Established in 1137, the private estate "funds the public, charitable, and private activities of the Prince of Wales and his family," its site says. It consists of land and properties in 23 English counties, and a portfolio of investments. While Prince Charles's siblings are paid through the Duchy of Lancaster, most of Prince Charles and Camilla Parker Bowles's income is from the Duchy of Cornwall—90 percent, according to CNN Money.
In 2019, Charles and Camila received nearly 22,000 pounds ($28 million American dollars) in income from the Duchy of Cornwall, and almost 2 million pounds of funding from the Sovereign Grant allotted to subsidize their official royal activities. "His Royal Highness chooses to use the majority of his income from the Duchy to meet the cost of his, The Duchess of Cornwall’s, The Duke and Duchess of Cambridge’s and The Duke and Duchess of Sussex’s public and charitable work," their annual review states. In the 2018-2019 fiscal year, Charles and Camila undertook 638 social engagements in 14 countries.
According to their 2020 financial report, "The Duchy of Cornwall’s income is broadly level when compared to last year."
What's the Queen's net worth, then?
It may surprise you to know that while the queen is certainly wealthy, she isn't a billionaire—but, somehow, she makes do.
In 2020, the Queen's net worth reportedly dipped by 20 million pounds from the previous year, according to the annual Sunday Times Rich List. The paper values her current net worth as £350m, or roughly $461 million USD.
In 2019, Forbes had assessed the Queen's net worth as equal to least $500 million USD. Per the Crown Estate's annual report for 2019/20, the value of the British royal land portfolio fell by 1.2 percent to £13.4 billion in 2020 due to the Covid-19 lockdown impacting tourism and retail in particular.
That downward trend is likely to continue. "Whilst it is far too early to accurately forecast our performance for the 2020/21 financial year, we do expect our net revenue profit and property valuations to be significantly down," the report added.
By reports, Her Majesty is notoriously frugal. "Newspapers are shredded for horse bedding, parcel string is reused, frayed sheets and dusters are darned," the Sunday Times writes in regards to Buckingham Palace housekeeping.
Harry and Meghan no longer receive Duchy of Cornwall money.
In the January 2020 announcement of their intention to step back from royal duties, Prince Harry and Meghan Markle stated an intention to "work to become financially independent." Like his brother Prince William, the Duke of Cambridge, Prince Harry had historically received income by way of funding from the Duchy of Cornwall.
But the newly-minted semi-private citizens will not receive any money from Prince Charles via the estate going forward, Newsweek confirmed in September. This makes sense, given that this income was for the public royal duties they've since ceased to perform. In September of 2020, the couple also announced that they'd paid back the £2.4 million in public money taken from the Sovereign Grant that was used to renovate their Windsor Home, Frogmore Cottage.
Also in September, Harry and Meghan inked what's believed to be a very lucrative Netflix deal, estimated to be worth between 100 and 240 million in U.S. dollars (the streaming platform hasn't confirmed a sum). That's in addition to Prince Harry's inherited wealth, and Markle's money from her previous career as an actress—in her days on USA drama Suits, she earned a reported salary of about $450,000 in addition to endorsements and related income.
Castles, stocks, and stamps
The queen's got assets, obviously. In addition to her personal portfolio of investments and a sweet stamp collection, Elizabeth inherited Balmoral and Sandringham Estates from her father. The queen couldn't hock a tiara or two if times got tough, however—she doesn't technically own the Crown Jewels, the royal residences, or most of the Royal Art Collections. Those must be passed on to the next sovereign (so they'll remain in the family, obviously).
And again, any income that trickles down to Elizabeth's children and grandchildren from the Duchies is on top of their own inherited wealth—for instance, Prince William and Prince Harry both received money from their mother Princess Diana's will upon their 25th birthdays.
Does the Queen pay taxes?
Yes. The queen has voluntarily paid income tax and capital gains tax since 1992; any income received from the Duchy of Lancaster that doesn't go to official expenses is taxed as well. She's subject to Value Added Tax also voluntarily pays local taxes.
What does paying the royals cost British taxpayers?
Out of pocket? Honestly, not much—collectively, that is. In 2018, it cost each average British taxpayer about 65 pence a year, according to Fast Company. So less than a dollar. Even with the cost spiking by 41 percent in 2019 per Business Insider, the individual taxpayer still pays cup-of-coffee money. An artisanal, organic cup of coffee.
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