A relative loaned 5K to a friend in Jan 2021.
In 2021, 1k was repaid.
There remains 4K owing and now the 'friend' is claiming the loan was only 2k to begin with.
No agreement was drawn up.
There is leverage perhaps in that the person getting the loan has been working and signing on and their community and connections from their country would not welcome this behaviour.
They would not be aware that they may be liable for tax on an interest free loan (does that apply between friends? Or only family loans?)
The value of the 5k in early 2021 versus now is 5700 odd.
If they refuse and do not repay is this sum potentially 'unjust enrichment'?
My relative is seeking legal advise as the friend is now just taking the mick.
I'm surprised my relative loaned any money at all, then again I let an idiot stay rent free in my house for 4 months! Live and learn!!
Steps and suggestions welcome.
In 2021, 1k was repaid.
There remains 4K owing and now the 'friend' is claiming the loan was only 2k to begin with.
No agreement was drawn up.
There is leverage perhaps in that the person getting the loan has been working and signing on and their community and connections from their country would not welcome this behaviour.
They would not be aware that they may be liable for tax on an interest free loan (does that apply between friends? Or only family loans?)
The value of the 5k in early 2021 versus now is 5700 odd.
If they refuse and do not repay is this sum potentially 'unjust enrichment'?
My relative is seeking legal advise as the friend is now just taking the mick.
I'm surprised my relative loaned any money at all, then again I let an idiot stay rent free in my house for 4 months! Live and learn!!
Steps and suggestions welcome.