Transferring property through love and affection, without selling or exchanging it, can be legally done using a Gift Deed.
A Gift Deed allows a person (the donor) to voluntarily transfer ownership of property or assets to another person (the donee) during their lifetime, without any monetary consideration.
When such a transfer occurs between family members or close relatives, it is known as a Gift Deed in Blood Relation, which often enjoys tax exemptions and lower stamp duty under Indian law.
What Is a Gift Deed?
A Gift Deed is a legal document that records the voluntary transfer of ownership of movable or immovable property from one person to another, without any payment involved.
It must be executed willingly, without coercion and registered with the sub-registrar’s office to be valid under the Transfer of Property Act, 1882.
In simple terms, it’s a legal way to “gift” property to someone while the donor is still alive.
What Is a Gift Deed in Blood Relation?
A Gift Deed in Blood Relation refers to the transfer of property or assets to a close relative, such as a parent, child, sibling or spouse.
Such transfers are often done to ensure family property remains within the family or to avoid inheritance disputes later.
The Income Tax Act, 1961, provides tax exemptions on gifts made to specified blood relatives, making this a popular option for tax-efficient transfers.
Who Are Considered Blood Relations for Gift Deed Purposes?
Under Indian tax and property laws, “blood relations” include:
- Parents and children
- Grandparents and grandchildren
- Brothers and sisters
- Spouse
- In-laws (under certain state laws)
- Legal heirs by adoption
Why Register a Gift Deed?
Registering a Gift Deed gives it legal validity and prevents disputes.
Once registered, the ownership is legally transferred and the donee becomes the lawful owner of the gifted property.
Without registration, the deed has no legal effect, even if both parties agree verbally.
Documents Required for Registration of Gift Deed
To register a Gift Deed or a Gift Deed in Blood Relation, you need:
- Original Gift Deed document (on stamp paper)
- Donor and donee’s ID and address proof
- Passport-size photographs of both parties
- Proof of property ownership (sale deed, tax receipt, etc.)
- Relationship proof (if gifting to a blood relative)
- Encumbrance certificate
- Two witnesses with valid ID proof
Process to Register a Gift Deed in India
Here’s how you can register a Gift Deed:
- Draft the Gift Deed with help from a lawyer, specifying property details and relationship between parties.
- Pay applicable stamp duty and registration fees (varies by state).
- Visit the sub-registrar’s office with the donor, donee and witnesses.
- Sign and register the document before the registrar.
- Once registered, the donee’s name is updated in property records.
Stamp Duty and Tax Benefits for Gift Deed in Blood Relation
The stamp duty for a Gift Deed in Blood Relation is significantly lower compared to gifting to non-relatives.
Many states, such as Delhi, Maharashtra, Haryana and Uttar Pradesh, offer full or partial exemptions for blood relatives.
Additionally, under Section 56(2)(x) of the Income Tax Act, no income tax is levied on property received as a gift from specified relatives.
Revocation of Gift Deed
Once a Gift Deed is registered, it cannot be revoked or canceled, except under specific conditions like fraud, undue influence or if both parties agree to revoke it through a new registered agreement.
Benefits of Executing a Gift Deed in Blood Relation
- Legally transfers ownership without sale
- Reduces inheritance disputes
- Offers tax and stamp duty benefits
- Provides peace of mind and family security
- Immediate transfer of rights without court proceedings
FAQs About Gift Deed
1. What is a gift deed?
A Gift Deed is a legal document used to voluntarily transfer ownership of property or assets from one person to another without any payment. It must be registered to be legally valid.
2. What is a gift deed in blood relation?
A Gift Deed in Blood Relation refers to property transferred between family members like parents, children or siblings. It often attracts lower stamp duty and tax exemptions.
3. Is registration of a gift deed mandatory?
Yes. Registration of a Gift Deed with the sub-registrar is mandatory under the Transfer of Property Act, 1882. Without registration, the gift is invalid in the eyes of law.
4. What documents are required for a gift deed?
You’ll need the original gift deed, property proof, ID proofs, relationship proof, witness details and stamp duty payment receipt for registration.
5. What is the stamp duty for a gift deed in blood relation?
Stamp duty varies by state. For blood relatives, some states charge 1% to 2% of property value or even offer full exemption (like Delhi and Maharashtra).
6. Is there any tax on a gift deed between family members?
No, gifts made to blood relatives are exempt from income tax under Section 56(2)(x) of the Income Tax Act, 1961.
7. Can a gift deed be revoked?
A Gift Deed can only be revoked if both donor and donee agree through a new registered agreement or if the original deed includes a revocation clause.
8. Can I gift property to my wife or husband through a gift deed?
Yes, a spouse is considered a blood relative, so you can gift property to your husband or wife using a registered Gift Deed with tax benefits.
9. What is the difference between a gift deed and a will?
A Gift Deed transfers property ownership immediately during the donor’s lifetime, while a Will transfers property only after the person’s death.
10. How long does it take to register a gift deed in India?
The registration process usually takes 1 to 3 working days, depending on document verification and local sub-registrar processing time.
