Grandparent tax free loan to pay off mortgage 19 June 2022 at 11:09AM in Loans 1 reply 241 views

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My grandad wants to pay off my remaining mortgage with a lump sum of 75k but then I pay him back tax free monthly for 10 years to repay the loan, if he passes before this he wants the remaining loan balance to be written off, how do we document this, are there any tax implications

Brie

I think you mean your GF wants to loan you the money interest free as he would not need to pay tax on any repayments that do not include interest.  Best to get a solicitor to write something up to cover the circumstances. 

You can also find out how anything unpaid would be dealt with by his estate though as I understand it anything unpaid would be considered an asset of the estate when calculating any IHT due.

Please also be aware that if he needs assistance with care social services will take note of the loan as a part of his income and will chase for non payment.