Loan with family

Chris White
Chris White
3 Thanks
153 Posts
12 years ago
Yes – no problem at all. Interest paid on a loan (or further loan) from family or friends is eligible for a tax deduction just as with any other loan, provided it is to finance the let property. Will your parents have a charge on the property? I’m not suggesting they should or shouldn’t - just that a higher interest rate could be justified if the loan is unsecured. That might be an overall advantage to the family in terms of tax if say, you are a higher rate taxpayer and your parents aren’t. Are they both taxpayers? Whichever way, the loan arrangement ought to be properly documented in case of HMRC queries.

Please Login

You must be logged in to participate in our forums, to continue please login below.

Not a member? From only £99 you can join in the discussion and get access to member's only resources and services.

As the home for landlords, the NRLA are here to help you save time, save money, and stay compliant. NRLA membership gives you access to a vast range of expertise, resources, and exclusive member benefits and savings, designed to help and empower members. We also play a pivotal role in campaigning and championing the interests of landlords.