FAQ / Draft of gift deed, List of Relatives from whom Gift can be received without any tax liability
In Continuance of my article on Taxability of gits from relatives and others , I have prepared FAQ on Gift, ,list of relatives from whom an individual can receive the gifts without any income tax liability and also giving below Draft of gift deed.
1. Frequently Asked Question on Gift deed
What is a gift deed?
A gift deed is an agreement used when a person wishes to gift his asset (property or money) to someone. It is the transfer of certain existing (not future) moveable or immoveable property made voluntarily and without any consideration from one person (called ‘donor’) to another (called ‘donee’).
Who can gift property?
Any valid owner of an existing property can gift property. A minor is incompetent to gift a property though a guardian can accept such a gift on his behalf.
WHAT is the law that governs gifts by one person to another?
Transfer of Property Act, 1882.
What is a Transfer of Property?
Transfer of Property is an act by which a living person conveys property in present or in future to one or more living persons.
What may be transferred?
Property of any kind may be transferred, movable or immovable.
Can there be an oral transfer?
A transfer of property may be made without writing, if it is not expressly required by law. Gifts under the Islamic law may be made orally, as it does not require registration.
What is a gift?
It is a transfer of existing movable or immovable property made voluntarily without consideration by one person to another.
What are the ingredients of gift?
Gift is made by one person called the donor to another called the donee. There should not be any consideration for making a gift. That is, the donor should not receive consideration of any kind while making a gift. The donee should accept the gift in the lifetime of donor.
How gift of an immovable property is made?
Under the Indian Registration Act, any transfer of any immovable property, if the value of the property is more than Rs 100, should be in writing and should be registered.
What are the formalities for registering a gift deed?
The donor on requisite stamp paper should sign the deed. It should be attested by at least two witnesses; the donee should accept the gift.
What is meant by attested?
Attestation of an instrument (document) means that witnesses who sign the instrument should have seen the donor signing the gift deed and they should sign as witnesses in the presence of the donor and in the presence of each other.
Does gift of movable property require registration?
Gift of movable property, may or may not be registered. But delivery of the property and acceptance of it are essential.
How to effect delivery of the property?
The same way as goods is delivered in sale of goods.
What is the effect of a gift comprising both existing and future property?
A gift comprising both existing and future property is void.
Can gift be made to several persons and if one does not accept it, what happens?
A gift to two or more persons (donees) and one of them does not accept it, it is void so far he is concerned.
Can gift once made be suspended or revoked?
The donor and donee may agree that on the happening of a specified event, which does not depend upon the will of the donor, a gift shall be suspended or revoked.
What is a gift deed?
A gift deed is an agreement used when a person wishes to gift his asset (property or money) to someone. It is the transfer of certain existing (not future) moveable or immoveable property made voluntarily and without any consideration from one person (called ‘donor’) to another (called ‘donee’).
Who can gift property?
Any valid owner of an existing property can gift property. A minor is incompetent to gift a property though a guardian can accept such a gift on his behalf.
Why should I require a gift deed ?
As per law, the title in a property cannot be delivered without a written instrument even when its value is small. Therefore, such deed is important to obtain and execute.
What is the procedure to use such a deed?
The draft of such a deed can be directly printed as per instruction kit provided and can be successfully executed by obtaining the signatures of the donor, donee and witnesses. The registration of a gift deed involves additional formalities that have to be taken care of (see below).
What are the essential elements of a Gift Deed?
As per Transfer of Property Act, a gift deed has the following essential elements:
- Transfer of Property
- No consideration (as it is just a gift)
- Acceptance by the donee
Is acceptance by the donee mandatory?
Yes, the acceptance of the gift is mandatory..
What happens if a person dies after making a gift deed without it being formally accepted by the donee?
As per directives by the court, acceptance of a gift is mandated without which such a deed is deemed void. Such acceptance must be made during the lifetime of the donor while he is ‘capable’ of making it.
Is registration of a gift deed mandatory?
As per section 123 of the Transfer of Property Act, the transfer of a gift of immoveable property must be effected by a registered instrument signed by donor and attested by two witnesses. For moveable property such as a car, such a registration is not mandatory and transfer can be achieved by delivery
2. If the individual person receives Gift from following persons are exempt from tax
| Father | Grand Father |
| Mother | Grand Mother |
| Brother | Great Grand Father |
| Sister | Great Grand Mother |
| Son | Daughter’s Husband |
| Daughter | Son’s Wife |
| Grand Son | Wife’s Father |
| Grand Daughter | Wife’s Mother |
| Husband | Husband’s Father |
| Wife | Husband’s Mother |
| Sister’s Husband | Wife’s Grand Father |
| Brother’s Wife | Husband’s Grand Mother |
| Wife’s Brother | Husband’s Grand Father |
| Wife’s Sister | Wife’s Grand Mother |
| Husband’s Brother | Wife’s Great Grand Father |
| Husband’s Sister | Husband’s Great Grand Mother |
| Mother’s Brother | Husband’s Great Grand Father |
| Mother’s Sister | Wife’s Great Grand Mother |
| Mother’s Sister Husband | Brother’s Wife |
| Wife’s brother’s wife | Mother’s Brother’s Wife |
| Father’s Brother | Husband’s Brother’s Wife |
| Father’s Brother’s Wife | |
| Father’s Sister’s Husband | |
| Father’s Sister |
In case of a Hindu undivided family, any member thereof;
3. Deed of Gift(Draft Copy )
1. Date:
2. Place:
3. Parties:
3.1 _____________________, son of ________________, by faith Hindu, by Nationality Indian, by occupation – __________, residing at ____________________.
(Donor, includes successors-in-interest and assigns)
– AND –
3.2 _____________________, son of ________________, by faith Hindu, by Nationality Indian, by occupation – __________, residing at ____________________.
(Donee, includes successors-in-interest and assigns)
[Donor, Donee collectively Parties and individually Party.]
NOW THIS DEED OF GIFT WITNESSES AS FOLLOWS:
4. Subject Matter of Gift:
4.1 Subject Land: ALL THAT piece or parcel of land hereditaments and premises measuring 1 one Cottah 8 eight Chhittacks be the same a little more or less out of the total land of 3 three Cottahs situate and lying at and being Municipal Holding No. _________, Ward No. _____, within the limit of ________ Municipality and having Postal Address _____________ and more fully and particularly described in the Schedule below and demarcated in colour Red on the Plan attached hereto (Subject Land).
4.2 The Structure: One-storied brick built dwelling house, having built up area of ____________ Square feet, be the same a little more or less, standing on the Subject Land (The Structure), described in the Schedule below.
4.3 Other Rights: Easements and all other rights, liberties, privileges and benefits appurtenant to the Subject Land and The Structure and all equipments, installations, fittings, fixtures etc. in or about The Structure.
4.4 Subject Property: The subject matter of the Gift is 4.1, 4.2 and 4.3 above, which are collectively described in the Schedule below and demarcated in colour Red and shown as “Lot – A” on the Plan attached hereto (collectively Subject Property).
5. Background:
5.1 Description of the Title: Chain of title is to be described in detail here.
5.2 Sale to Donor: By a Deed of Sale dated _______, registered in the Office of the Sub-Registrar, ________, in Book No. I, Volume No. ____, Pages __ to ___, Being No. ______ for the year __________ (Said Deed), said _______ (Name of the previous owner) sold the aforesaid plot of land measuring about 5 Decimals or 3 three Cottahs more or less comprised in Dag No. ______ as aforesaid to the Donor hereto.
5.3 Ownership of the Donor: In the circumstances, the Donor hereto became the sole and absolute owner of ALL THAT piece or parcel of land measuring 3 (three) Cottahs be the same a little more or less including the common passage situate and lying at ____________________ and comprised in _____________.
5.4 Construction by the Donor: Subsequently, the Donor constructed a one-storied brick built dwelling house on his acquired property as aforesaid in accordance with the building plan duly sanctioned by the appropriate authority.
5.5 Said Property: Thus the Donor has become the sole and absolute owner in respect of the land and the structure as referred above (Said Property). The Subject Property is the part and portion of the Said Property.
6. Representations and Warranties of the Donor:
6.1 Absolute Ownership: The Donor is the absolute owner of the Subject Property.
6.2 Right, Power and Authority to Sell: The Donor has good right, full power, absolute authority and indefeasible title to gift and/or alienate the Subject Property.
6.3 Free from Encumbrances: The Subject Property is free from all claims, demands, encumbrances, mortgages, charges, liens, attachments, lis pendens, uses, debutters, trusts, prohibitions, Income Tax Attachment, Financial Institution Charges and liabilities whatsoever or howsoever made or suffered by the Donor or any person claiming through the Donor and the title of the Donor to the Subject Property is free, clear and marketable.
6.4 No Prejudicial Act by the Donor: The Donor has not at any time done or executed or knowingly suffered or been party or privy to any act, deed, matter or thing whereby the Subject Property or any part thereof can or may be impeached, encumbered or affected in title.
6.5 No Personal Guarantee: The Subject Property is not affected by or subject to any personal guarantee for securing any financial accommodation.
6.6 No Bar by Court Order: There is no order of Court or any other statutory authority prohibiting the Donor from transferring and/or alienating the Subject Property or any part thereof.
7. Basic Understanding: The Donee is the son of the Donor and the Donor bears natural love and affection for the Donee. The Donor has expressed his desire of gifting the Subject Property in favour of the Donee and the Donee has agreed to accept such gift.
8. Gift:
8.1 Hereby Made: The Donor doth hereby gift to the Donee, absolutely and forever, free from all encumbrances of any and every nature whatsoever, the Subject Property, described in the Schedule below, being:
8.1.1 Subject Land: ALL THAT piece or parcel of land hereditaments and premises measuring 1 one Cottah 8 eight Chhittacks be the same a little more or less, out of the total land of the Donor, i.e. 3 three Cottahs situate and lying at and being Municipal Holding No. __________, Ward No. __, within the limit of _________ Municipality and having Postal Address __________ and more fully and particularly described in the Schedule below and demarcated in colour Red on the Plan attached hereto.
8.1.2 The Structure: One-storied brick built dwelling house, having built up area of _________ Square feet, be the same a little more or less, standing on the Subject Land.
8.1.3 Other Rights: Easements and all other rights, liberties, privileges and benefits appurtenant to the Subject Land and The Structure and all equipments, installations, fittings, fixtures etc. in or about The Structure.
8.2 Consideration: Natural love and affection that the Donor bears for the Donee.
9. Terms of Gift:
9.1 Salient Terms: The gift of the Subject Property being effected by this Deed is:
9.1.1 Gift: A gift within the meaning of the Transfer of Property Act, 1882.
9.1.2 Absolute: Absolute, irreversible and forever.
9.1.3 Free from Encumbrances: Free from all encumbrances of any and every nature whatsoever including but not limited to lis pendens, attachments, liens, charges, mortgages, trusts, debutters, reversionary rights, residuary rights, claims and statutory prohibitions.
9.1.4 Other Rights: Together with Easements and all other rights, liberties, privileges and benefits appurtenant to the Subject Property.
10. Miscellaneous:
10.1 Delivery of Possession: Simultaneously with the execution of these presents khas, vacant and peaceful possession of the Subject Property is handed over by the Donor to the Donee (Possession Date).
10.2 Outgoings: All Municipal and other taxes, penalties, surcharge, outgoings, liabilities and levies on or relating to the Subject Property till the Possession Date, whether as yet demanded or not, shall be borne, paid and discharged by the Donor and thereafter that shall be borne, paid and discharged by the Donee.
10.3 Holding Possession: The Donor hereby covenant that the Donee shall and may, from time to time and at all times hereafter, peacefully and quietly enter into, hold, possess, use and enjoy the Subject Property and every part thereof and receive rents, issues and profits thereof and all other benefits, rights and properties hereby gifted or expressed or intended so to be unto and to the Donee, without any lawful eviction, hindrance, interruption, disturbance, claim or demand whatsoever from or by the Donor or any persons lawfully or equitably claiming any right or estate therein from under or in trust from the Donor.
10.4 Further Acts: The Donor hereby covenants that the Donor or any person claiming under him, shall and will from time to time and at all times hereafter, upon every request and at the cost of the Donee and/or successors-in-interest of the Donee, do and execute or cause to be done and executed all such acts, deeds and things for further or more perfectly assuring the title of the Donee to the Subject Property.
10.5 Production of Said Deed: As referred hereinbefore, the Said Deed and all other title documents in respect of the Said Property shall be lying with the custody of the Donor and unless prevented by fire or other unavoidable accidents from time to time and at all times hereinafter at like request and cost of the Donee, the Donor or his successors-in-interest will produce or cause to be produced the Said Deed and/or the said documents for reasonable requirement as may be required from time to time.
10.6 Assessment of Value for the purpose of Advalorem Stamp Duty: For the computation of stamp duty, the value of the Subject Property is assessed at Rs. ______/- (Rupees ________) only.
11. Interpretation:
11.1 Number: Words denoting the singular number include, where the context permits and requires, the plural number and vice-versa.
11.2 Headings: The headings in this Deed are inserted for convenience only and shall be ignored in construing the provisions of this Deed.
11.3 Definitions: Words and phrases have been defined in the Deed by bold print and by putting them within brackets. Where a word or phrase is defined, other parts of speech or grammatical forms of that word or phrase shall have corresponding meaning.
Schedule above referred to
(Subject Property)
[Subject Matter of Gift]
Detail of the Subject Property with boundary description …………
The Plot is shown on the Plan annexed hereto with the border Red and the Plan is treated as a part of this Deed.
12.Execution and Delivery:
12.1 In Witness Whereof the Donor has executed and delivered this Deed of Gift on the day, month and year mentioned above.
| (DONOR) | |
| I accept the Gift mentioned hereto with pleasure: | |
| (DONEE) | |
| Witnesses:
Signature: _________________________ Name: Father’s/Husband’s Name: Address: |
Signature: ________________________ Name: Father’s/Husband’s Name: Address |
Also Read:
S.56 pertaining to gifts, deemed gifts / under-valuations
‘Corporate Gifts – Beware of Tax Implications’
Taxation of Gift- Under Income Tax
———————–
Author
T.Xavier M.Com,PGIT, (ICWAI- Final)
Email – [email protected]
(Republished With Amendments)
I have gift deed in my favour from grandfather regarding money to be received on account of acquisition. My grandfather had died. Can I become sole legal heir in a court case on the basis of gift deed?
Sir, My daughter and son-in-law have a residential land jointly in bangalore and are living abroad Son-in-law wants to gift his share of the property to his wife (my daughter) and get the Gift deed regd in Bangalore through me on a POA. Kindly clarify and also the charges towards gift deed.
A Unregistered Gift Deed on Stamp Paper executed in 1986 to ” Daughter of Mother,s Sister” not comes in Close Blood Relation. Possession given to her in 1986.That time value of Land was Rs. 5000/-. Now how Legal transfer may be done without given any Tax. Stamp Duty may be given.
A Unregistered Gift Deed on Stamp Paper executed in 1986 to ” Daughter of Mother,s Sister” not comes in Close Blood Relation. Possession given to her in 1986.That time value of Land was Rs. 5000/-. Now what can be done.
I have not read yr comments yet
List of relatives who get tax exempt on gift deed is wrongly published.
Tax exempt is only for near relatives.
Please update the site content.
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Can i gift my self owned house property to my one daughter when my son & another daughter are alive.is there ay legal implication
Can I receive property My mother to my wife through sale deed. Is it valid.
MY mother wants to gift house to my wife through a gift deed. Is it right according to law. Is it tax free. Is it registerd by notary public is valid please reply soon
Sir,
I am holding a BDA immovable property site in my name at Bangalore. I want to gift 50% share of the said property to my wife and make her joint owner of the said site in the records of BDA, Bnagalore.
Please tell me the procedures followed and also provide me a draft format of the gift deed to be made.
Thank you
Dear sir
I got a property that value between 50 to 55 lac in 40 years above old building. The owners want to gift us there is no relation between donor and donee it just good relation and donee care of them from 15 to 20 year, so can u give reply me is it taxable or exampted
Shall I gift a house to my wife’s sister with tax benifit and stamp duty concession
hello sir, i am planning to sell my property to my sister through gift. Also I am planning to get money(50 lakhs) from her through gift.. This will occur on same day. will it create any trouble?
I have a property with my proprietorship name(i am single owner).
Can I gift my property to my daughter (she is married) under gift deed ?
AUTHOR SPELT PROFORMA AS PERFORMA ! FURTHER, IT CAN NOT BE CALLED A PROFORMA SINCE IT IS NOT A TAX INVOICE, BILL OR QUOTATION AT ALL ! AT THE MOST IT SHOULD HAVE BEEN TITLED AS DRAFT OF A GIFT DEED !
(Comment is been edited by Taxguru Team)
Can I give property to my friend
My mother wants to gift a bunglow in her name to me – her son. My question what amount stamp paper is needed? My second question is whether I have to pay any stamp duty based on market value of the property?
May I gift my property to my mother
Hello sir,
I have a question for you.My uncle(Mom’s cousin brother) wanted to gift a flat on my mother’s name. It is from his own earnings and not from ancestors. And I have some doubts like will the registration deed will be valid in the future? once the registration is completed, can the donor have the right to revoke the property from my mother without her permission? Do we need to face any challenges from my uncle’s children?Do we need to take any extra deeds/ agreements along with gift deed from my uncle against revocation in future? what precautions should be taken by us while registering the deed ?Please help me and thank you.
Same question asked please rply
My parents have gifted me a house property. Can i claim deduction for principle & interest on housing loan in my return for the same property?
Hello,
My mother is a joint owner in a flat with me and my husband. There is no mortgage on the flat and now my mother wants to exit from the joint ownership and release her share in my name. so can this be done as a GIFT DEED or RELEASE DEED without paying the stamp duty. The entire payment of the property was done by my husband and me and there was no financial involvement of my mother . please revert on the same. Thanks.
Whether any condition may be imposed in a gift deed by the donor.
I want to gift an immovable property to my fathers sister…is such transfer of property by way of gift allowed or not?
My mother, who’s a joint holder of property with me wants to transfer her portion by using gift deed. The above said property is held as collateral with a nationalised bank in housing loan. This loan is in joint name with me, and my mother is a co applicant.
2 years back I got married with same bank employee. Now that bank is not allowing me to transfer the housing loan in her name quoting the reason that “mother in law can not be considered as close relative”.
I want to invest 7 lakhs in a SCSS in Post Office for my sister in her name this month (Oct 2018). She is around 74 and does not earn money. I am 61 and a superannuated PSU employee. Should I make a gift deed? Is it necessary to register it? Should my sister file IT return in AY2019-20?
pls tell me my wife’s grandmother interested to pay Rs.15 lakh as gift money through cheque is it under income tax or what is the procedure for gift deed or is it necessary for registered or not, tell me the procedure.
Excellent. Simple and lucid.
Great article, thank you
Can any property be gifted to a person who is not related as per the above category?
Is gift of property received by grand son and grand daughter from a jointly held property (joint by mother and her father – who got it because of the death of mothers mother) exempt from gift tax? Please help Sir. Thanks.
sir i want to gift my flat to wife can u give me suggestion for income tax rule , can i pay income tax for this flat
श्रीमान जी
मैं अपने पिता जी को अगर कैश या चैक के माध्यम से गिफ्ट करता हूँ तो क्या मुझे कोई गिफ्ट डीड बनवाने की आवश्यकता है। व उस गिफ्ट का उन पर कोई टैक्स बनेगा । व उनकी रिटर्न फाइल करनी पड़ेगी या नहीँ। कृपया मुझे बताइये।
धन्यवाद।
Dear Sir / Madam
I received a plot of land from my Grand Mother (Mother’s mother) through gift deed (note: this is not during my marriage). As per this blog, this will not be taxed. However, please advise if the value of the gift deed needs to be reported during my IT returns filing
MY MOTHER MADE A WILL ON STAMP PAPER, AT ANKLESHWAR, GUJARAT, AND REGD. AT GUJARAT, FOR A PROPERTY OF 1 BHK FLAT AT MUMBAI, THAT AFTER HER DEATH, SHE INTENDED TO SELL THIS PROPERTY AND EARNED AMOUNT TO BE DISTRIBUTED TO ALL THREE SONS AND TO SOME ONE WHOM SHE HAD AFFECTION-SOME OR OTHER HOW, LATER ON , WHEN MY ONE BROTHER KNEW ABOUT IT, HE MADE A GIFT DEED TO TO GIFT THAT PROPERTY TO IN NAME OF HIS SON & DAUGHTER ( MY MOTHER’S GRAND CHILDREN NOW MY MOTHER DIED, AND I AM NOT ABLE TO SELL THE PROPERTY AS PER WISH OF MY MOTHER, & AS PER REGD WILL
CAN WE CONSIDER THE GIFT DEED AS NOT APPLICABLE AFTER DEATH OF MY MOTHER.-PL. REPLY CAN BE GIVEN ON OUR E MAIL ID [email protected]