Prince Harry and Meghan Markle's royal baby could be forced to pay US taxes

Prince Harry and Meghan Markle.
Prince Harry and Meghan Markle. Photo credit: Getty

Prince Harry and Meghan Markle's baby could be faced with the prospect of paying US taxes its entire life.

Ms Markle is an American citizen, which could mean the newborn is subjected to the US tax law, thus potentially exposing the royal family's notoriously private finances to a foreign tax system.

The baby, due in spring 2019, will be granted automatic US citizenship, owing to its mothers heritage and her satisfying certain State Department criteria.

Holding two passports may seem attractive, but America's tough tax system could make it an onerous task for the Britain-based baby.

America is one of the few world countries to tax based on citizenship not residency, so if you hold an American passport but rarely set foot in the US, you are still obliged to report your global income to the US tax department. 

That would mean the royal family would have to report all of the baby's royal fortune to America, and face paying American tax on it.

Former UK MP Boris Johnson rescinded his American citizenship in 2016, citing "absolutely outrageous" tax bills in the US that he did not want to pay.


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