Prince Harry will not be getting the full payout of his court victory against the publisher of the Sun due to US laws.

The Duke of Sussex settled his legal action against News Group Newspapers (NGN) earlier this week, with the publisher offering an apology over allegations of unlawful information-gathering and substantial damages.

Harry alleged he was targeted by journalists and private investigators working for NGN, which also published the now-defunct News Of The World.

The prince’s trial – along with Lord Tom Watson, former Labour deputy leader, who was also taking legal action against the publisher but also settled his claim – was set to last up to 10 weeks but on Wednesday morning, his barrister David Sherborne said that the parties had “reached an agreement” and that NGN had offered an apology to the duke and would pay “substantial damages”.

According to the BBC, the “substantial damages” were estimated to be at least £10million each, but US taxation rules mean Harry won’t be able to keep the full amount.

The Daily Mail’s Richard Eden claimed the majority of Harry’s sum is thought to be reserved for his lawyer’s fees and whatever remains will have to be taxed in the US.

A source told the outlet: “As a US resident, Harry has to pay tax on his worldwide income unless it’s been taxed in Britain.

“And here’s the sting in the tail: legal damages are not taxed in the UK.’

On Wednesday, NGN offered its “full and unequivocal apology” to the duke for the “serious intrusion” by The Sun between 1996 and 2011 and for the “phone hacking, surveillance and misuse of private information” by journalists and private investigators instructed by them at the News Of The World.