What is a family mortgage in the Netherlands?
A family mortgage is a loan from a relative for your own home. Your parents or another family member lends you the money instead of a bank. You sign a loan agreement, you pay interest and you repay the loan. The interest can lower your Box 1 income, exactly as with a bank mortgage.¹ Box 1 is the Dutch tax box for income from work and your own home.
A family mortgage is not a gift. The money comes back with interest, on the schedule you agreed. Two sets of rules therefore run alongside each other: the rules for the loan and the rules for a gift.
Take Zeynep. She moved to Utrecht five years ago and works as a pharmacist. She is buying a flat there. Her parents in Izmir are lending her part of the purchase price. We follow her loan through this page.
This page covers the loan between relatives and the interest deduction that goes with it. It does not cover how the deduction rate itself works. Our page on the mortgage interest deduction explains the rate and the 30-year term. Gift amounts and gift tax sit on our gift tax page.
In short
A loan, not a gift. A family mortgage is money you borrow from a relative and repay with interest.
Six conditions. Your loan has to meet all six at once, not just most of them.¹
Case by case. The Belastingdienst judges your rate against what a bank would charge, using its own published examples.²
30 years, annuity or linear. This applies to every loan taken out from 1 January 2013.¹
You report it yourself. For loans from 1 January 2013 you enter the loan in your return.¹
Gifting the interest back. Parents may gift a child up to €6,908 tax-free in 2026.³ Keep that gift separate from the loan.
Which conditions make the interest deductible?
The interest is deductible only when your loan meets all six conditions below.¹ Zeynep's loan has to clear every one of them. The Belastingdienst applies the same list to a loan from family, from a bv or from a foreign bank.¹ A bv is a Dutch private limited company.
Read the table as a checklist. Two of the six apply only to loans taken out from 1 January 2013. An older loan keeps the rules that applied when it started.¹ You do not need a notary to make the loan agreement valid.
| Condition | What the Belastingdienst asks | Applies to |
|---|---|---|
| Your own home | You use the loan to buy, improve or maintain the home you live in. Buying off an erfpacht ground lease also counts. | Every loan from family |
| Interest at a market rate | Your rate matches what a bank or another financial institution would charge. | Any rate you agree |
| Annuity or linear repayment | You repay the loan in full within 30 years. The minimum yearly repayment goes into the loan agreement in advance. | Loans from 1 January 2013 |
| Interest actually paid | You really pay the interest. Interest that your lender waives falls outside the deduction. | Every year the loan runs |
| No fiscale partners |
How do you report a family loan to the Belastingdienst?
You enter the loan and your lender's details in your own tax return.¹ A bank passes your interest details on automatically. Your family does not. Neither does a foreign bank or a bv.¹ That duty applies to loans taken out from 1 January 2013.¹
Zeynep's parents live outside the Netherlands, so nothing about her loan reaches the Belastingdienst on its own. She keeps the loan agreement and her parents' details to hand. She fills them in every year the loan runs. Without those details there is no deduction for that year.¹
Not sure whether your loan agreement covers all of this? We look at it with you.
Can your parents gift the interest back?
Parents may gift money back, as long as it stays separate from the loan. The loan has one rule of its own here: the interest has to be genuinely paid.¹ Whatever your relatives do afterwards, that payment has to be real.
The gift side runs on its own track. In 2026 parents may gift a child up to €6,908 without gift tax.³ For anyone else the yearly exemption is €2,769.³ The Belastingdienst counts both parents together as one giver.³
So Zeynep's parents can use that exemption. What they cannot do is promise it in advance. Where that goes wrong is set out just below.
Our page on gift tax sets out every exemption and rate. Our page on tax-free gifting covers the practical side.
What the gift-back looks like over a year
The yearly exemption caps the gift and never lowers what you owe in interest.
Zeynep's first year puts numbers on those rules. Say the interest she owes her parents comes to €7,000 over her first full year. She pays it in monthly transfers from her own account, so the payment is real.
The yearly exemption caps what her parents may hand back, whatever the interest happens to be. That ceiling runs per year. Our gift tax page covers the one-off exemptions as well. The table below sets out her year in four steps.
| Step | How it is set | Result |
|---|---|---|
| Interest Zeynep pays over the year | monthly transfers to her parents | €7,000 |
| Yearly gift exemption, parents to child, 2026 | set by the Belastingdienst³ | €6,908 |
| What her parents may gift her that year | a separate decision, within the exemption | up to €6,908 |
| Interest Zeynep owed for the year, whatever her parents gift | the gift does not reduce this amount | €7,000 |
“Families usually get the money right and the paperwork thin. Write down the rate, the term and the repayment before the money moves. That bit of admin is what the Belastingdienst asks you to show later.”
What this means for you
So the exemption caps the gift, and it never touches what Zeynep owes. Put the agreement in writing before the money moves, then keep the deduction alive in every return.
Write down the amount, the rate, the term and the repayment schedule. Keep the agreement and your lender's details where you can find them at filing time. Compare every year what you paid against what you agreed.
A family loan rarely covers the whole purchase. Many buyers combine one with a bank mortgage, which our first mortgage page walks through. Replacing an existing bank mortgage with family money is a different move again. Our refinance mortgage page covers what that costs.
Borrowing from family abroad works on the same six conditions.¹ The gift side can be another matter, so read our page on gift tax from abroad before your family transfers anything.
This is general information, not personal advice. Our associated company advises on the mortgage itself. The tax side stays with us. Our mortgage advice page shows how that one conversation works. Leaving the Netherlands while the loan runs changes your return, so ask us first.
¹ belastingdienst.nl, Renteaftrek lening eigen woning bij familie, bv of buitenlandse bank? · Accessed
² belastingdienst.nl, Voorbeelden van rentepercentages voor familieleningen · Accessed
³ belastingdienst.nl, Tot welk bedrag is een schenking belastingvrij in 2026? · Accessed
Common questions about a family mortgage
Can I deduct interest on a loan from family abroad?
Yes, the same six conditions apply.¹ Where your lender lives makes no difference. You still report the loan yourself, because a foreign lender does not report it for you.¹