Paradise Papers | Queen's private estate sent millions to Bermuda and Cayman Islands

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That isn't illegal. But the specific revelations in this case demonstrate the potential pitfalls of holding offshore investments in tax-free jurisdictions and raise questions about where the money can end up.

They've all been named in the Paradise Papers, a massive trove of documents detailing how some of the world wealthiest and most powerful people use offshore tax havens to reduce their taxes or hide ownership of assets.

The documents about Elizabeth's financial holdings are part of a tranche of some 13.4 million records of offshore accounts leaked to German newspaper Suddeutsche Zeitung and shared with the International Consortium of Journalists and a network of more than 380 journalists in 67 countries.

The Duchy of Lancaster, which has its headquarters in London, manages the monarch's private estate to generate the Queen's income.

"The Queen voluntarily pays tax on any income she receives from the Duchy".

Hundreds of individuals and companies reportedly have had their overseas investments exposed by the files, which are also said to reveal that major global companies have exploited offshore schemes to avoid tax.

The Duchy claims it was unaware of the fund's 12-year investment in BrightHouse, until approached by the group of newspapers involved in the Paradise Papers project.

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As per reports in the BBC, during 2004-05 the Duchy invested over Rs 42 crore in Bermuda-based Jubilee Absolute Return Fund Ltd and around the same amount in Dover Street VI Cayman Fund LP.

Just last week, it emerged BrightHouse had agreed to reimburse customers to the value of almost £15m after agreeing a compensation package with the Financial Conduct Authority, following a two-year investigation. It said that all its investments were legitimate.

Graham Smith, the CEO of Republic, said: "The Queen's personal wealth and investments mean she has a direct interest in government decisions about tax".

"The Dover Street investment was bought in 2005 and forms only 0.3% of the total value of the duchy". Per the documents, some of the money was invested in a fund that ended up contributing to BrightHouse, a chain with an alleged history of irresponsible lending, and liquor store chain Threshers, which went belly-up in 2010 after owing £17.5 million in United Kingdom taxes.

Her use of offshore tax havens is likely to generate criticism from activists seeking to abolish the monarchy in favor of a republic.

The Queen doesn't directly oversee the Duchy's investments, and most of its income, while private, goes toward covering the expenses for her and other royals that aren't covered by public funds through the sovereign grant.