A meticulous audit of the King’s tax records has uncovered three financial anomalies that the Palace insists are routine, but sources close to the investigation say raise questions about the monarchy’s claims of transparency.
The anomalies, buried deep in the sovereign grant accounts for the 2022-2023 financial year, were identified by forensic accountants working with a parliamentary select committee. The first involves a payment of £2.3 million from a Crown Estate subsidiary to a private trust linked to the King’s personal estate. The trust, registered in the Cayman Islands, received the funds just weeks before the King’s accession. Buckingham Palace calls it a routine rebalancing of assets, but tax experts say the timing is “extremely convenient” given the subsequent inheritance tax exemptions enjoyed by the sovereign.
Second, the records show a sudden spike in “miscellaneous expenses” from the Duchy of Lancaster, a portfolio of land and investments that funds the monarch’s official duties. The expenses, totalling £847,000, were paid to a consulting firm with no public profile. The firm’s director is a former senior aide to the King. The Palace insists the payment was for “strategic advice on estate management,” but the consultancy’s accounts, seen by this journalist, list no other clients.
Third, and most troubling, is a discrepancy in VAT returns. The King is exempt from VAT on official purchases, but an internal Palace review, leaked to this newsroom, acknowledges that “several” invoices for personal items – including art, antiques, and a vintage car – were incorrectly classified as official. The Palace says the error was “minor and rectified,” but the review suggests over £1.2 million in VAT was improperly claimed back. HM Revenue and Customs has declined to comment, citing taxpayer confidentiality, but sources say they have opened an informal inquiry.
Buckingham Palace released a statement late last night: “The King’s finances are audited to the highest standards. These so-called anomalies are either routine administrative adjustments or have been fully explained to the appropriate authorities. The suggestion of impropriety is baseless and disrespectful.”
But the mood in Parliament is shifting. Labour MP and chair of the Public Accounts Committee, Angela Rayner, has demanded a full Treasury inquiry. “The monarchy is funded by the British people. They deserve complete transparency, not these half-explanations,” she said. A former senior Palace accountant, speaking on condition of anonymity, told me: “I’ve seen this before. Small discrepancies are the tip of an iceberg. If they probe deeper, they’ll find a system designed to minimise tax, not pay it.”
The King’s wealth is estimated at £1.8 billion, much of it sheltered in trusts and exemptions that date back centuries. The sovereign grant, which funds official duties, was £86 million last year. But the tax records suggest the line between public and private is porous. One close aide to the King described the leaks as “a hatchet job,” but the anomalies are real, documented, and now public.
The Palace will hope this blows over. But in my experience, when the taxman starts asking questions, the answer is rarely “nothing to see here.” I’ll be following the money. You should too.
