Some staff at Clarence House have been warned their jobs are at risk following King Charles III's accession to the throne.
The Guardian, external said dozens of staff were told during the thanksgiving service for the Queen in Edinburgh on Monday.
Clarence House said some redundancies were "unavoidable" because of the change in role for Charles and his wife Camilla, now Queen Consort.
They were working to find alternative roles for employees, a spokesman said.
The Guardian reported that private secretaries, the finance office, the communications team and household staff were among those who had been warned of redundancies, as the offices of King Charles III and the Queen Consort move to Buckingham Palace.
The King's top aide, his principal private secretary Sir Clive Alderton, said in the letter to staff that the change in role for the former Prince of Wales and Duchess of Cornwall meant Clarence House would be "closed down".
He said the former Prince of Wales's personal interests and former activities would no longer be carried out.
"It is therefore expected that the need for the posts principally based at Clarence House whose work supports these areas, will no longer be needed."
Staff were left livid and shaken by the announcement, the newspaper said.
However, Grant Harrold, former butler to King Charles when he was the Prince of Wales, said the news would not have come as a shock to staff.
He told the BBC: "Trust me, it's not a shock for the household."
"When I joined, I was fully aware that if the Queen passed I would be redundant because my boss is no longer the Prince of Wales."
Mr Harrold, who previously worked at Highgrove House, the King's family residence in Gloucestershire, added: "The good thing is, I know they will do everything possible to make sure that people are put into positions where possible - and, as I said, there will be people that want to retire or want a change of career."
Clarence House, which stands alongside St James's Palace, was the official London residence of the Prince of Wales and the Duchess of Cornwall.
It has not yet been confirmed whether the King and Queen Consort will live at Buckingham Palace.
The households of the Queen Mother and the Duke of Edinburgh were closed after their deaths.
Any Clarence House staff being made redundant will be offered "enhanced" redundancy payments, it is understood. No staff will be affected for at least three months.