What Should Meghan Markle Tell U.S. Tax Authorities?
Meghan Markle will have a complicated tax status while she remains a U.S. citizen living in the U.K.
Based on the tax laws, even if the "Suits" star lives full-time in the UK with Prince Harry, she still needs to file a U.S. return every year. This will be expensive for Markle as she will be charged taxes in the U.K. and by the American tax agency, IRS.
"Duchess or no duchess, when it comes to the IRS, Meghan is like every other American citizen," US tax specialist Alistair Bambridge of Bambridge Accountants told (http://www.dailymail.co.uk/news/article-5442861/Meghan-Markle-tell-tax-authorities-cash-secrets.html) Daily Mail . "Each year she must file her tax return and pay any tax she owes to Washington."
Bambridge explained that the U.S. income tax system is based on one's citizenship. Thus, it doesn't matter where one lives as long as one is a U.S. citizen, one has to pay taxes.
Here are five things that Markle has to tell the U.S. tax authorities.
(http://www.ibtimes.com/whats-meghan-markles-net-worth-prince-harrys-fiancees-income-examined-2618628) Markle's net worth is currently at $5 million. Whatever she makes from acting and sponsorship, she needs to declare it.
If the "Horrible Bosses" star receives more than $100,000 from Prince Harry or the royal family as her royal allowance then she needs to declare it. Prince Harry, Prince William and Kate Middleton receive an annual $4.88 million allowance for travel and wardrobe.
Markle has to declare all of her properties to avoid any ambiguity. Even the place where she lives may be taxed.
"Clearly Meghan's case is a unique one, as she may be taxed according to the rental value of a home she lives in for free - Kensington Palace," Bambridge added. "Working out the market rental value of a royal palace is not a task for the fainthearted."
If Markle and Prince Harry have joint assets, bank accounts or offshore trusts over $200,000 then Markle has to declare it. The couple is likely to have this as many believed that they will not opt for a prenup agreement.
"No I don't think they will," said (http://www.ibtimes.com/prince-harry-meghan-markle-unlikely-sign-prenup-agreement-source-says-2622197) Julian Hawkhead , a U.K.-based family law attorney, said about Prince Harry and Markle getting a prenup. "The precedent has therefore been set by Harry's father and brother, neither having entered in prenuptial agreements before they married."
Whatever luxury gift Markle purchase in the US for Prince Harry, Queen Elizabeth II and his family will be taxed if it's over $188. Custom duty charged a rate of 2.5 percent on gifts between $188 to $877. There is also a VAT of 20 percent of the total value of the goods.
|Printer friendly Cite/link Email Feedback|
|Publication:||International Business Times - US ed.|
|Date:||Mar 1, 2018|
|Previous Article:||Queen Elizabeth II's Failed Assassination Attempt In Dunedin Confirmed?|
|Next Article:||Princess Diana Was Involved In 2 Car Accidents, Says Former Butler.|