Prince Harry and his wife Meghan will stop using their royal titles, give up state funding and repay taxpayer money used to refurbish their home at Windsor Castle as they seek to pursue new careers outside of Britain's royal family.
The deal is intended to end a crisis that erupted two weeks ago when the couple abruptly announced plans to step back from their royal duties and spend part of each year in North America.
It will come into this spring and the new arrangement will be reviewed after a year by the senior royals.
What does it mean for their titles?
Harry will remain a prince and sixth in line of succession. But the couple will no longer be working members of Britain's monarchy, no longer use their Royal Highness titles and will now be free to seek a private income
Harry will also relinquish his honorary military appointments and his status as a Commonwealth youth ambassador. But the couple will preserve their links to a network of private charities.
Harry and Meghan will no longer receive income from the monarchy's funding, known as the "Sovereign Grant". This is a government handout that covers the running costs of the royal household and travel expenses.
The couple previously said the grant was equivalent to 5 percent of their income toward running their official office. The remaining income came from Prince Charles's centuries-old private estate.
Charles, heir to the throne and father of Prince Harry and Prince William, will continue to offer private financial support although the details of this was not spelled out.
They will also repay the 2.4 million pounds (NZ$4.7 million) in public money used to refurbish Frogmore Cottage, the house in grounds of the queen's Windsor Castle they moved into last year.
A royal source said the couple would pay a commercial rent on the property.
How will they earn money?
The couple have not said how they intend to fund themselves in future. Some of Queen Elizabeth's other grandchildren work, including Prince Andrew's daughters Beatrice and Eugenie, who work in business and the arts.
Last year, Harry said he would be teaming up with US television mogul Oprah Winfrey to produce a documentary on mental health for Apple's video streaming service.
New video footage was published at the weekend showing the couple at the premiere of Disney's Lion King in London last year. It shows Harry telling the film's director that Meghan, a former actress, is available for voiceover work, with Meghan saying: "That's really why we're here - it's the pitch."
Six months ago Harry and Meghan applied to the UK Intellectual Property Office to trademark the phrases Sussex Royal and Sussex Royal Foundation for use on books, stationery, clothing such as pyjamas and socks, charity campaigns and the provision of training, sport and social care.
It is unclear if they will retain the Sussex Royal brand name and monogram of a crown above an entwined H&M.
Where will they live?
They said they now plan to divide their time between Britain and North America.
They will continue to base themselves at Frogmore Cottage in the grounds of the queen's Windsor Castle when in Britain.
Meghan was born in Los Angeles and she grew up in Hollywood. Harry and Meghan, who lived in Canada while filming the TV show Suits, spent the last six weeks of 2019 in Canada and their first official appearance of 2020 was a trip to Canada House in London, home of Canada's diplomatic mission to Britain.
Who pays for security?
It is also not clear who will pay for the couple's security, which could run into millions of pounds per year. Buckingham Palace declined to comment on those arrangements.
Until now, the couple have received armed personal protection from London's police paid for by taxpayers. But they are no longer working royals, which may influence what publicly funded security they are entitled to.
A former head of royal protection said that Britain's Home Office will probably continue to provide the couple with some police protection, given their status as prominent public figures.