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The BBC is an autonomous public service broadcaster that operates under a Royal Charter and a Licence and Agreement from the Home Secretary. Within the United Kingdom its work is funded principally by an annual television licence fee, which is charged to all British households, companies and organisations using any type of equipment to record and/or receive live television broadcasts; the level of the fee is set annually by the British Government and agreed by Parliament.

Outside the UK, the BBC World Service has provided services by direct broadcasting and re-transmission contracts by sound radio since the inauguration of the BBC Empire Service in December 1932, and more recently by television and online. Though sharing some of the facilities of the domestic services, particularly for news and current affairs output, the World Service has a separate Managing Director, and its operating costs have historically been funded mainly by direct grants from the British government. These grants were determined independently of the domestic licence fee. A recent spending review has announced plans for the funding for the world service to be drawn from the domestic licence fee.