Finances of the British Royal Family

The British royal family is financed mainly by the hereditary revenues of the Crown. The British Parliament uses a percentage of the Crown Estate, a part of the Crown's hereditary revenues belonging to the sovereign that is placed at the disposal of the House of Commons, to meet the costs of the sovereign's official expenditures. This includes the costs of the upkeep of the various royal residences, staffing, travel and state visits, public engagements, and official entertainment. The Keeper of the Privy Purse is Head of the Privy Purse and Treasurer's Office and has overall responsibility for the management of the sovereign's financial affairs.

Until 1760 the monarch met all official expenses from hereditary revenues, which included the profits of the Crown Estate (the royal property portfolio). King George III agreed to surrender the hereditary revenues of the Crown in return for the Civil List, and this arrangement persisted from 1760 until 2012. The Civil List was paid from public funds and was intended to support the exercise of the monarch's duties as head of state of the United Kingdom. In modern times, the Government's profits from the Crown Estate always significantly exceeded the Civil List. Under the Civil List arrangements the royal family faced criticism for the lack of transparency surrounding Royal finances. The National Audit Office was not entitled to audit the Royal Household.

The Queen received an annual £7.9 million a year from the Civil List between 2001 and 2012. The total income of the Royal Household from the Treasury was always significantly larger than the Civil List because it included additional income such as Grants-in-Aid from the Treasury and revenues from the Duchies of Cornwall and Lancaster. The total Royal Household income for the financial years 2011-12 and 2012-13 was £30 million per annum, followed by a 14% cut in the following year. However, the Treasury provided an additional £1 million to pay for Diamond Jubilee celebrations in 2012.

Royal expenditure differs from income due to the use of a Reserve Fund, which can be added to or drawn from. The official reported annual expenditure of the Head of State was £41.5 million for the 2008-09 financial year. This figure did not include the cost of security provided by the police and the Army and some other expenses.

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