Gift Deed for Property Transfer: Giving or receiving gifts is a part of many important occasions in our lives. We exchange gifts at one time or another. However, there are several factors involved, depending on the value and nature of the gift, that bring it under legal scrutiny and determine its validity.
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Gift Deed for Property Transfer: Gift transactions are integral to Indian culture. An important part of gifting is the gift deed, or gift document. A gift deed is legally valid only if it is registered in accordance with the rules by paying stamp duty and a registration fee. Like most property transfers, a gift deed registration fee applies to ensure this is legally mandatory. Some states charge 1% of the property’s value as the gift deed registration fee, while others charge a standard fee.
Under the Transfer of Property Act, gifting a home requires a registered document. This document must be signed by the person gifting the property and also requires the signatures of two witnesses. This means that a person cannot simply decide to gift a property. To do this, he or she must follow the complete legal process, just as with a sale deed. Let’s find out the stamp duty applicable on a gift deed.
1. Varying Fees by State
Stamp duty rates vary across states in India. Typically, they range from 2% to 7% of the property’s market value (circle rate). For example, rates vary in Uttar Pradesh, Delhi, and Maharashtra.
2. Special Discounts for Female Beneficiaries
Since you want to gift a flat to your daughter, you may be eligible for a 1% to 2% discount on stamp duty in many states. Most states in India charge lower fees for female buyers or female beneficiaries.
3. The Benefit of ‘Blood Relations’
One major advantage of gifting property to a daughter is that many states (such as Maharashtra, Uttar Pradesh, and Haryana) have significantly reduced the stamp duty on gift deeds between close family members.
In some states, this may be a nominal fixed charge (such as ₹5,000 or ₹1,000).
In some states, it is as little as 1% of the property value.
4. Registration Fees
In addition to stamp duty, you also have to pay a registration fee. This is usually 1% of the property value or has a cap (such as a maximum of ₹30,000).
5. Valuation
Stamp duty is always calculated based on the circle rate (government rate) of the property. If the market rate is higher than the circle rate, the duty will be charged at the circle rate.
Only ₹6,000 Fee in Uttar Pradesh
In Uttar Pradesh, a gift deed, partition deed, and family settlement or memorandum of understanding can be executed in favor of the respective members to divide family property among family members for just ₹6,000. Until now, a 7% stamp duty was charged on property division, including ₹5,000 for stamp duty and ₹1,000 for processing fees.
Note: To find out the exact fee, you should check the website of your area’s sub-registrar office or consult a local lawyer, as rules change periodically.
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