1:18 PM PT -- Buckingham Palace just released a statement, saying, "Discussions with The Duke and Duchess of Sussex are at an early stage. We understand their desire to take a different approach, but these are complicated issues that will take time to work through."
This is huge ... Prince Harry and Meghan Markle are doing something unheard of in the Royal Family -- they're throwing in the towel when it comes to performing senior royal duties and are now determined to become financially independent, and our sources say part of that is moving to Canada.
Harry and Meghan just announced the big change, saying, "After many months of reflection and internal discussion, we have chosen to make a transition this year in starting to carve out a progressive new role within this institution. We intend to step back as 'senior' members of the Royal Family and work to become financially independent, while continuing to fully support Her Majesty The Queen."
They go on ... "We now plan to balance our time between the United Kingdom and North America ... This geographic balance will enable us to raise our son with an appreciation for royal tradition into which he was born, while also providing our family with the space to focus on the next chapter, including the launch of our new charitable entity."
Our sources say the move to North America is actually Canada -- a British Commonwealth nation -- where Meghan has some roots. She filmed "Suits" in Toronto where she rented a house.
As for the nuance of giving up "senior royal duties" ... there is only a small group of royals who, in the absence of the Queen, carry out the duties of the Monarchy. Harry and Meghan will no longer be part of that group.
As we reported, Meghan has had an extremely difficult time adjusting to royal life and the fishbowl she found herself in. She made it clear during a recent interview ... she was not okay and struggling with her new position.