Do you want to make a gift deed for your kin? Are you looking for the procedure to gift a property to your children or parents? Want to understand what a gift deed is or how it is drafted? Then you are at right place.
A deed is a document that records the transfer of the legally held title of property from one party to another. As a rule, the only immovable property requires a deed. It records the same, the main difference being that no price is paid for the property being transferred.
It includes two parties, the donor, who is the person who passes the title and the donee, who is the person to which the property is transferred.
All these requirements are mandated by Transfer of Property Act, 1882 and Registration Act, 1908.
According to Section 17 of Registration Act, an immovable property which is to be transferred must be registered for the deed recognized by law. For registration to take place, stamp duty and a registration fee must be paid for registration in the sub-registrar’s department under whose jurisdiction the property comes.
The stamp duty for a gift deed is usually much cheaper than that for a sale deed because of the absence of a taxable price for the property to be transferred. As the stamp duty rate is a subject prescribed by the list of states, each state has the discretion to set its stamp duty and registration fees to collect revenue.
The applicable stamp duty in Punjab varies between 0.5% and 6% as the state is about to change its Stamp Act. However, the applicable price for a gift deed is lower than the sale deed (which is currently 6% in Punjab) and therefore the stamp duty will fall into this range. These are stamp tax, which is to be paid in Punjab for the registration of property. Due to a recent change by the Government of Punjab in 2012, no application fee will be charged if the property is transferred to any blood relative within the lifetime of the donor and the blood relatives the spouse, son, daughter, father, mother, brother, sister, grandson and granddaughter.
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