Prince Harry and Meghan Markle potentially saved up to £690,000 with a deal to pay no further rent on Frogmore Cottage, it has been reported.
The Duke and Duchess of Sussex struck the deal with Buckingham Palace when they refunded £2.4million used to renovate the Windsor property, it is claimed.
They had initially been expected to pay a “commercial rate” when they moved into the residence in 2019.
The five-bedroom property's estimated rental value is between £150,000 to £230,000 a year, meaning the Sussexes potentially saved £690,000 over the last three years.
It was reported earlier this month that Harry and Meghan had been asked to vacate Frogmore Cottage, and they will not renew their lease when it expires later this month.
The deal with Buckingham Palace considered the increase to the value of the property following the work done should be taken as “rent in lieu”, the Mail on Sunday reports.
A Palace spokesperson said in quotes reported by the Mail: “The Duke and Duchess of Sussex made a contribution of £2.4 million to the Sovereign Grant which covered the refurbishment of Frogmore Cottage. They have fulfilled their financial obligations in relation to the property.
“In line with usual practice for the Sovereign Grant report, the accounting treatment was scrutinised and signed off by the National Audit Office and the Treasury.
“As with any such agreement between landlord and tenant, further details regarding the Sussexes' tenancy arrangements would be a private matter.”
However, one critic is now eager to know how many other royal properties are being rented out below the market rate.
Former Liberal Democrat MP and Privy Counsellor Norman Baker said in the Mail: “It is outrageous that Harry and Meghan should be able to live in a huge house on these terms while regular people struggle to put food on the table.”
Frogmore Cottage became the Sussexes official residence in 2019 and they moved in after extensive renovation work converted the building from multiple residencies into a large family home.
When they stepped back from royal work to become “financially independent”, Buckingham Palace released a statement saying it was the couple's “wish to repay Sovereign Grant expenditure for the refurbishment of Frogmore Cottage, which will remain their UK family home”.
The deal to wipe out future rent obligations as part of the payment was not made public at the time.
Buckingham Palace confirmed that the £2.4million was split into three headings and recorded across two sets of accounts.
In the 2020/21 Sovereign Grant figures, the lump sum was listed as both “rental income” and as “recharges for functions and other income”.
A year later, the remainder of the lump sum appeared in the accounts as “deferred income under current liabilities”.
