Tax Implications if borrowing money from my Partner

[Amber22]

My partner is offering to Lend me the additional funds needed to secure a house in the current market.
This would be a loan to be repaid over the coming years. (There will be no mortgage lender Involved)
1. Would this Loan be liable for Capital Acquisition Tax/ other taxes by revenue ?
2. Would an official loan document need to drawn up or is it ok just to have this agreed between us ?
Any information would be much appreciated.

 

[NoRegretsCoyote]

1. Would this Loan be liable for Capital Acquisition Tax/ other taxes by revenue ?

No issue once it's actually a loan. That means there has to be a repayment schedule and interest rates charged on what your partner could earn at the bank (so basically zero).

However for smaller amounts it can de facto be a gift as you can gift someone €3k a year with no CAT implications too. So for example they could lend you €30k today, then "gift" you €3k to pay them back every year, and after ten years the loan is gone and there is no CAT obligation.

2. Would an official loan document need to drawn up or is it ok just to have this agreed between us ?

I would strongly advise you to have this. Even done via separate solicitors. This is more to protect yourselves than as anything for Revenue.

 

[Amber22]

Thank you so much for your reply