Offset mortgage question

My Dad has enough 'spare' cash to pay off our mortgage currently sat in a savings account. When our fixed rate mortgage comes to an end in April we were thinking of getting an offset product, offsetting Dad's money against the mortgage, and gradually paying him the cash back. That will save us a substantial amount of interest. That also means if Dad needs the money for any reason, he can have it back from the offset straight away.

I believe we can't arrange to pay my Dad interest on his money without him being chased by HMRC for tax, is that right?

The obvious risk with this idea is if my hubby left he'd have a half claim on the money, as it would presumably need to be in our account and in our name. I'm totally confident that won't happen, but wondering if we should get something drawn up legally to protect my Dad's funds?

Dad is highly unlikely to need it for care fees etc as he's only early 60s, and we will certainly be able to pay it back within 10 years.

In terms of mortgage figures, we're at 75% LTV and the amount is for 2.5x joint earnings, currently with Santander.

Can anyone offer any advice on anything else we need to consider before going ahead, or spot any problems with the idea that we haven't thought of?

Thanks :)