If you borrow money from your own private limited company or from a family member to finance your own home, you must inform the tax authorities of this loan. If you fail to do so, or do so too late, the tax authorities will not regard the loan as a home loan and you will not be allowed to deduct the interest from your income as home loan interest.
The notification must be submitted before 1 February 2016 if you amended the terms of the loan in 2015.
If you take out a mortgage with a recognised financial institution (such as a bank or insurance company), that institution will notify the tax authorities.
What information should be provided?
You must inform the Tax and Customs Administration in the following circumstances:
– taking out the loan;
– a change to the terms of the loan.
The Tax and Customs Administration uses the information provided in your notification to check whether you actually meet the repayment requirement for a home loan. After all, a home loan must be repaid on an annuity basis over a period of at least 360 months.
Taking out a mortgage on your own home
You must notify us of any new loan no later than the earliest of the following dates:
– when you submit your income tax return for the year in which you took out the loan;
– 31 December of the year following the year in which you took out the loan.
For example, if you took out the loan on 1 July 2015, you must inform the Tax and Customs Administration of this by 31 December 2016 at the latest. Unless, that is, you submit your 2015 income tax return before 31 December 2016. In that case, you must inform the tax authorities no later than the date on which you submit the return.
Changes to the terms and conditions of the loan
You must notify the Tax and Customs Administration of any change to the terms of the loan during its term no later than the month following the calendar year in which the change took place.
For example, if you took out the loan in 2014 and changed the interest rate in 2015, you must notify the tax authorities of this change by 31 January 2016 at the latest.
How do you notify the tax authorities?
The information must be sent to the Tax and Customs Administration using a form prescribed for that purpose form. You can do this online (using your DigiD) or on paper. If you submit your notification in any other way, it will be rejected by the Tax and Customs Administration.
With effect from 1 January 2016, this process has been simplified for notifications relating to the taking out of loans or changes to loan terms in the 2016 tax year and subsequent tax years. These notifications must be included in the income tax return for the relevant tax year.
Late notification
A late notification can be rectified. If you submit the notification within one month of the end of the following calendar year, the loan will once again qualify as a home ownership loan with effect from that calendar year.