Taxes & rules
Family mortgage: how the interest deduction works
In short
Interest on a qualifying family loan for an owner-occupied home can be deductible, but only when the use, repayment, rate, actual-payment and reporting conditions are met. A contract and monthly payment alone do not guarantee eligibility.
The loan must finance the owner-occupied home
The borrowed money must be used to buy, improve or maintain the borrower’s own home, or for qualifying ground-lease rights. Keep invoices and transfer records that connect the borrowing to the eligible expenditure.
Annuity or linear repayment within 30 years
For a loan entered into from 1 January 2013, the principal generally must be repaid on an annuity or linear basis within 360 months. The minimum repayment schedule should be recorded before the loan starts and then followed in practice.
Comparable interest must actually be paid
The rate should correspond with what an independent financial institution would charge under comparable conditions. The borrower must actually pay the interest; waived or merely booked interest is not treated the same as paid interest.
Report the loan and check the fiscal-partner rule
The borrower must report the loan information in the income-tax return. Borrower and lender generally cannot be fiscal partners, except for the official own-home exception described by the Belastingdienst.
When is a notary required?
A notarial deed and public registration are required to establish a mortgage right over the property. Mortgage security is not itself a condition for interest deduction, but the other tax conditions still apply.
Sources and further reading
Facts checked against the primary sources below on 16 August 2026.
Belastingdienst: interest deduction for an own-home loan from family
Belastingdienst: examples for assessing family-loan interest rates
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