Lending money to family or friends without a written agreement can damage relationships and create tax problems. Our free private loan agreement template for Spain lets you document any personal loan properly, in Word format, with all the legally recommended clauses included.
Why you need a written loan agreement
In Spain, the tax authorities (Agencia Tributaria) scrutinise large cash movements between individuals. If you transfer a significant amount to a family member or friend without documentation, AEAT may classify it as a gift (donación), which is subject to Gift Tax (Impuesto de Sucesiones y Donaciones) — potentially a large and unexpected tax bill. A properly signed loan agreement with repayment terms is the clearest evidence that the transfer is a loan, not a gift.
Key clauses in a private loan agreement
A complete private loan agreement should specify the loan amount, the date of transfer, whether the loan is interest-free or interest-bearing, the repayment schedule (lump sum or instalments), the consequences of late or missed payments, and what happens in case of default. Both parties should sign and keep a copy. For loans above €6,000 it is strongly recommended to also submit the contract to AEAT (model 600, even if ITP is zero for interest-free loans) as official evidence.
Can a private loan be interest-free in Spain?
Yes. Private loans between individuals can be interest-free. However, if the loan is between related parties (family members) and the interest rate is below the legal market reference rate, AEAT may impute notional interest income to the lender. For loans to companies from shareholders or related parties, transfer pricing rules apply. For purely personal loans, interest-free arrangements are common and generally accepted when properly documented.
Does a private loan need to be notarised?
No. A private document (documento privado) signed by both parties has full legal validity for loan agreements in Spain. However, a notarised deed (escritura pública) provides stronger legal protection, is required for mortgage-backed loans, and has a higher evidentiary weight in court. For loans above €10,000–15,000 or between business partners, notarisation is worth considering.
Frequently asked questions
Does a private loan need to be declared to AEAT?
The loan itself does not generate income for the lender (if interest-free), but it is strongly recommended to submit the signed contract to AEAT as model 600 (exempt from tax but officially registered) to prevent the transfer being classified as a gift.
What is the maximum loan amount for a private agreement?
There is no legal maximum for a private loan agreement. However, for amounts above €10,000, cash transfers are prohibited in Spain — the money must move by bank transfer to leave a paper trail.
Can I charge interest on a private loan?
Yes. Both parties are free to agree any interest rate. If you do charge interest, the lender must declare the interest income in their IRPF return. Interest on loans between natural persons is taxed as capital income at 19–28%.
What if the borrower does not repay?
With a signed loan agreement, you can pursue recovery through the civil courts. A notarised deed is enforceable more quickly. Without any documentation, proving the loan exists is much harder.
Download your free private loan agreement now.
Private Loan Agreement →