The Queen reportedly told the Duke and Duchess of Sussex that "you work for the monarchy, the monarchy doesn't work for you," during showdown talks.
This week seemingly brought the tensions to a head as it was publicly confirmed that Prince Harry and Meghan Markle would be stripped of their patronages after the pair announced they would be permanently leaving the royal family.
In March 2020, Harry and Meghan stepped back as senior working royals, choosing instead to earn money in the United States to gain greater levels of personal and financial freedom.
The couple have since signed deals with Netflix and Spotify which have been estimated at being worth up to £100 million.
Nonetheless, they were hopeful of keeping some of the titles associated with their status in the royal family, particularly in the arts, military, Commonwealth, and sporting organisations, in a "half-in, half-out" arrangement.
This could allow them a greater degree of independence they desired, whilst also maintaining ties to organisations close to their hearts.
Harry, who is very passionate about the armed forces, was reportedly eager to retain formal links with the UK military.
But an insider reportedly told the Mail: "The Queen has been very clear from the start that this 'half in, half out' model demanded by the Sussexes wouldn't work and hasn't deviated from that. Not once.
"Their original idea was to have a 'third way' of being a royal. And the Queen has said quite simply 'no, you can't'."
As a result, Harry will now no longer hold his former roles of Captain General of the Royal Marines, Honorary Air Force Commandant of the Royal Air Force Base Honington, and Honorary Commodore-in-Chief of the Royal Naval Commands' Small Ships and Diving.
Meghan Markle and Prince Harry have 'given two fingers to monarchy' after losing titles
Harry has also lost positions as the patron of the Rugby Football Union, and the Rugby Football League.
Meghan, who had previously worked as an actor, lost her patronages of the Royal National Theatre and the Association of Commonwealth Universities.
A spokesperson for the Sussexes said: "As evidenced by their work over the past year, the Duke and Duchess of Sussex remain committed to their duty and service to the UK and around the world, and have offered their continued support to the organisations they have represented regardless of official role.
"We can all live a life of service. Service is universal."
Buckingham Palace said in a statement: "The Duke and Duchess of Sussex have confirmed to Her Majesty the Queen that they will not be returning as working members of the royal family.
"Following conversations with the duke, the Queen has written confirming that in stepping away from the work of the Royal Family it is not possible to continue with the responsibilities and duties that come with a life of public service.
"The honorary military appointments and royal patronages held by the duke and duchess will therefore be returned to Her Majesty, before being redistributed among working members of the royal family.
"While all are saddened by their decision, the duke and duchess remain much-loved members of the family."
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