Yes, you can restore it by legal forms in accordance with the regulations in force. Depending on the amount, you may not get all cash back due to the need to comply with applicable customs regulations, etc. But a bank transfer is always possible. If you are in financial difficulty and believe that a friend or family member can lend you money, you should also exercise caution. While there is no 100% guarantee that you will get your money back, there are some precautions you can take to get a refund by mitigating the risk of possible non-payment. First, make sure you properly record all loan and payment terms, mutually agreed interest rates, and dates, even if you are lending money to your own family, family, or friends. Mixing economic problems with parents doesn`t always go well. Therefore, the first step that we must take into account in this situation is the trust generated by the person who asked us for the money or from whom we asked for it. If a parent gives money to their children or a friend to another without expecting that money to be returned, it is a gift and is subject to gift tax. This tax is autonomous and varies greatly from one municipality to another, but in all cases it must be declared and accounted for.
For more information about federal regulations protecting customers who send money abroad, see New Federal Transfer Rules. After the signing of this contract, the loan will be one hundred percent legal. It could even be made public when you go to a notary, but in the case of a loan to a friend, it doesn`t need to be necessary. In Asian culture, if someone needs money to carry out a project, it is the people around them, not the financial institutions, who lend them the money. It is much easier for these debtors to sleep when they know that their creditor is an acquaintance and not a bank. Lending money to a friend is much more normal there than here. Plus, it`s faster and more personal. Make it clear when and how he should return the borrowed money. Create a detailed payment schedule with a schedule and deadlines and talk to the borrower in question about how you will do it if something goes wrong and they can`t meet the set payment deadlines. This is the doubt that many people have. Even Pepe Average was surprised when his brother-in-law offered to give him the money he needed to buy a vehicle.
Its operation is typical of any bank loan: a creditor (e.g. You) lend money to a debtor (your friend) and the debtor undertakes to return it within the agreed time and interest rate. The repayment term and interest rates are generally lower than those of a conventional loan. In this article, we teach how to get the Treasury not to burden us with borrowing money from relatives or friends. With these returns, you don`t have to pay taxes to advance or ask for money. It is enough to follow the proper procedure and always register the loan in writing, both private and official. Let`s see what steps need to be taken so that this loan is completely legal and can not cause you any problems. Be very careful: if you do this with your money, your bank will cry out at the Treasury In the difficult times that happen, we may be in a situation where a loved one asks us to borrow money. Today we are going to tell you how to lend money to a friend or family member without this loan causing problems between us. The problem with this type of loan lies in their taxation, since the Department of Finance, until proven otherwise, assumes that at least the legal interest on the money has been calculated. In this sense, Article 6.5 of the Income Tax Law stipulates that «the supply of goods, rights and services likely to generate income from labour or capital shall be remunerated until proven otherwise… «, Article 40 stipulating that the valuation of such income must be made at the normal market value, which would be the legal interest on the money for these transactions.
If you are thinking of lending money to a friend and need advice, contact us. Our professional team is at your disposal for any economic question. Finally, we cannot ignore the personal risk associated with lending money. You risk losing the friendship or relationship with this person in addition to the money you lent them. Therefore, we recommend that you think about it and, if you decide to do so, follow our advice and formalize the contract in writing and before the Ministry of Finance. And if you never want to be able to ask a friend or relative for money, start working on your finances and minimize your need for external financing. If you don`t and the Treasury determines that you tried to cover it up, it will inspect the money and force you to pay it. If we do not want to recover the money we borrow, we must be careful, because this is not considered a loan but a gift, and in this case we have to deal with inheritance and gift tax, which can be very different depending on your autonomous community. A common question is whether there should be some kind of interest in©contracts between individuals, between family or friends. The answer is no, it can be free loans (without prejudice to all regulations relating to related party transactions).
If we include interest, in this case we must remember that the person who enters it must declare it in the IRPF and the one who pays it must make a deduction on the invoice, but as we say, it is not necessary at all. Have you ever been asked for money or need to give a few thousand euros to a child? If you want to leave money borrowed legally and with guarantees of recovery to friends or family, we will explain how to do it in this article. Whether you are the one who needs to ask for money or the one who will lend it, with the formula we tell you in this article, you have all the security in the world to do it legally and make sure that you are at peace and that there will be no legal consequences. Because everything will be reflected in a model loan agreement between relatives, in which the essential terms and clauses of the agreement will be reflected. A loan between individuals is the legal formula to lend money between individuals without the intervention of a bank or financial institution. As we explained on another occasion, it is regulated by Law 16/2011, of 24 June, if it is a personal person, and by Law 2/2009, of 31 March, if it is a mortgage. In this article, we`re going to shed light on how to legally lend money to a friend or family member. And when we say legal, we mean that we are faced with the costs and taxes that arise from operating as a lender with the knowledge of the Department of Finance, which, as we know, is everywhere. We are talking about a© pawnshop.
The scheme is simple. We will not lend him the money, we will lend him a bank, on the agreed terms. To ensure that these are as tight as possible, the potential lender who does not deposit a deposit of the same©amount as collateral for the loan©sets out. The bank recovers the loan like any other, and in case it is not paid, it can execute the guarantee by canceling the remaining loan©©against the deposit. This document must contain everything related to the agreed loan and its terms. The identification data of both parties must be included (DNI, full name, marital status, address and location) and it must also be clearly indicated who lends the money and who receives it. Also the amount of the loan, as well as the object and method of payment (handwritten, bank transfer or checkbook). Finally, you must specify how the return will be made. On the other hand, it will be necessary to justify the return of the borrowed money, otherwise the Treasury could consider it to be a disguised donation and therefore require the payment of inheritance and gift tax.
Therefore, it is important that the return is made by bank transfer or any other means that leaves a trace. If the person to whom you have lent money does not comply with their obligation to return the money on time, do not hesitate to remind them. Make it clear to the debtor that you are pending and monitoring payments. Trying to disguise a gift as a loan is illegal and if the Treasury recognizes it, you will face legal problems. Our advice is not to try. Unfortunately, this habit of lending money to a friend is not so common in Europe. Here we are more than accepting the pre-granted loan, using the credit card or going to the bank branch to ask the manager for a few thousand euros. For the debtor, this formula is more dangerous and more expensive in the event of default, since he must pay significant interest. Can you get him cheaper what he needs to buy so he can afford it? Can you leave him what he needs to buy? Money doesn`t always have to be the only option and if you can save the loan, better. Be very careful with this.