Loan from partner - is it tax exempt?

[maxjam]

Need a new car for work, partner has agreed to loan me 15K , I will pay back with interest over 4 years. Is this money from partner something that could have tax implications for us?

 

[Brendan Burgess]

Only in theory.

Assuming it's an interest-free loan , Revenue could decide that you are getting a gift equal to the interest of around €450 a year.

As this is well below the €3,000 threshold which people are allowed to give gifts tax-free, it's not relevant.

But you probably should do a short note setting out that it's a loan and the terms of repayment.

Brendan

 

[orka]

The OP said there would be interest (which should indeed be below the 3K annual gift limit) - so the partner would have to declare the interest income and pay income tax on it wouldn't they?

 

[elcato]

Lads, don't complicate things. Get the loan, pay it back, don't tell revenue anything. Unless you somehow get a revenue audit this is just an agreement between friends.

 

[Ciru75]

The OP said there would be interest (which should indeed be below the 3K annual gift limit) - so the partner would have to declare the interest income and pay income tax on it wouldn't they?

In theory, yes. In reality, no one will know or care.