{"id":28211,"date":"2021-03-26T12:32:52","date_gmt":"2021-03-26T07:02:52","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=28211"},"modified":"2021-03-27T12:10:42","modified_gmt":"2021-03-27T06:40:42","slug":"stamp-duty-provisions-applicable-on-gift-deed","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/stamp-duty-provisions-applicable-on-gift-deed\/","title":{"rendered":"What are the Stamp Duty Provisions Applicable on Gift Deed?"},"content":{"rendered":"\n<p class=\"has-drop-cap\">Section 122 of the Transfer of Property Act provides with a definition of gift as a transfer of existing movable and immovable property which is made voluntarily and without any consideration. Hence, gift deed is a legal document that contains the voluntary transfer of gift from the donor (property owner) to donee (gift receiver) without any consideration. Gifting of a house property is subject to certain income tax and&nbsp;stamp duty implication. In this article, we will discuss the important aspects of gifting of property in India and stamp duty provisions on <a href=\"https:\/\/corpbiz.io\/gift-deed-registration\"><strong>gift deed<\/strong><\/a>.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/stamp-duty-provisions-applicable-on-gift-deed\/#What_are_the_Basic_Essentials_of_Gift_Deed\" >What are the Basic\nEssentials of Gift Deed?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/stamp-duty-provisions-applicable-on-gift-deed\/#Legal_Requirements_to_Comply_for_a_Valid_Gift_Deed\" >Legal Requirements\nto Comply for a Valid Gift Deed<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/stamp-duty-provisions-applicable-on-gift-deed\/#What_are_the_Provisions_of_Stamp_Duty\" >What are the Provisions of Stamp Duty?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/stamp-duty-provisions-applicable-on-gift-deed\/#Factors_to_Consider_while_Making_Stamp_Duty_Payment\" >Factors to\nConsider while Making Stamp Duty Payment<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/corpbiz.io\/learning\/stamp-duty-provisions-applicable-on-gift-deed\/#What_is_the_Stamp_Duty_for_Executing_Gift_Deed\" >What is the Stamp\nDuty for Executing Gift Deed?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/corpbiz.io\/learning\/stamp-duty-provisions-applicable-on-gift-deed\/#How_to_Pay_Stamp_Duty_in_India\" >How to Pay\nStamp Duty in India?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/corpbiz.io\/learning\/stamp-duty-provisions-applicable-on-gift-deed\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_Basic_Essentials_of_Gift_Deed\"><\/span>What are the Basic\nEssentials of Gift Deed?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><em><strong>The basic essentials which a gift deed must comply with to make it a valid transfer of gift:-<\/strong><\/em><\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img decoding=\"async\" src=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/03\/What-are-the-Basic-Essentials-of-Gift-Deed-1.png\" alt=\"Basic Essentials of Gift Deed\" class=\"wp-image-28331\" width=\"545\" height=\"441\" srcset=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/03\/What-are-the-Basic-Essentials-of-Gift-Deed-1.png 900w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/03\/What-are-the-Basic-Essentials-of-Gift-Deed-1-300x243.png 300w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/03\/What-are-the-Basic-Essentials-of-Gift-Deed-1-768x622.png 768w\" sizes=\"(max-width: 545px) 100vw, 545px\" \/><\/figure><\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Legal_Requirements_to_Comply_for_a_Valid_Gift_Deed\"><\/span>Legal Requirements\nto Comply for a Valid Gift Deed<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>According to the Transfer of Property Act, it is\nmandatory requirement that the gift of a transfer of house property has to be registered\ninstrument, signed by the person gifting the property or on his behalf and it\nis ought to be attested by two witnesses.<\/p>\n\n\n\n<ul><li>Section\n17 of the Registration Act, 1908 makes it obligatory for the registration of\nthe gift deed with the sub-registrar. <\/li><li>The\ntransfer of property is invalid if a gift deed is not registered.<\/li><li>It is\nthe duty of the registrar to ensure that proper stamp duty has been affixed on\nthe gift deed or document at the time while it is given for registration.<\/li><li>The\namount of registration charges and the charges of stamp paid with regard to the\ngift deed are usually the same as in a regular sale. Nonetheless, in case the\ngift deed is transferred between some particularclose relatives then there are few states that provide concessions\nin the stamp duty.<\/li><\/ul>\n\n\n\n<p>For example, the state of Maharashtra has fixed a cap on the stamp charges that is paid on gifting agricultural property or the residential property to one\u2019s children, spouse, grandchildren or wife of a son who has died, at the amount of Rs 200, irrespective of the property\u2019s value.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/what-is-the-gift-deed-and-how-it-works\/\">What is the Gift Deed and how it Works?<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_Provisions_of_Stamp_Duty\"><\/span>What are the Provisions of Stamp Duty?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Stamp duty is governed by The Indian Stamp Act, 1899. The\nincurred Stamp charges differs from state to state and it varies depending upon\nthe property in consideration during the registration. It is\ncollected and levied by the state government<\/p>\n\n\n\n<p>Thus, a\nstamp charge refers to the tax that the government levies during the\ntransaction of the property. It is a kind of physical stamp that is impressed\non the gift deed or the legal document which ensures the transaction of\nproperty and confirms that the tax has been paid.<\/p>\n\n\n\n<p>Mere\nphysical possession of the property is not sufficient so it is important to\nhave the legal evidence for the ownership of the property. Hence, it is\nmandatory to get the gift deed registered and comply with the stamp requirements\nto make a valid gift deed.<\/p>\n\n\n\n<p>Stamp charge\nis the direct tax payable under section 3 of the Indian Stamp Act, 1899. It is payable\non all financial transaction documents &nbsp;including promissory notes, bills of exchange,\nin addition to the property transactions.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Factors_to_Consider_while_Making_Stamp_Duty_Payment\"><\/span>Factors to\nConsider while Making Stamp Duty Payment<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li><strong>Location-<\/strong> Stamp charges differ from state to state and the rates also differ in different areas. So, if the property is situated in a municipal area, the person will have to pay a higher rate than any property situated in a rural area.<\/li><li><strong>Full Payment &#8211;<\/strong> The payment given under&nbsp;Stamp Duty&nbsp;has to be the discharge of payment in full.<\/li><li>Purpose- Stamp charges depends on the purpose for which it is used. Hence, the commercial buildings attract higher stamp fee in comparison with the residential buildings.<\/li><li><strong>Age of the Building- <\/strong>It is important to know the age of the building because the stamp rates are calculated depending on the percentage of the whole value of the property in the market.&nbsp;Hence, Old buildings have less stamp charges than the new buildings as the market value of the old building gets depreciated.<\/li><li><strong>Legal Document &#8211;<\/strong> The document on which the stamp rate is paid must be legitimate and should be admissible under the court of law to make it a valid gift deed.<\/li><li><strong>Ages of the Owner- <\/strong>Most of the state governments have subsidized the stamp charges for senior citizens. Hence, the owner\u2019s age is important in deciding the charge.<\/li><li><strong>Gender of the owner-<\/strong> Women also gets the benefit of stamp duty concession if the property is in her name.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_Stamp_Duty_for_Executing_Gift_Deed\"><\/span>What is the Stamp\nDuty for Executing Gift Deed?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>After the drafting of the gift deed it shall be printed on the stamp paper of the appropriate value and get registered at the registrar office the stamp charges varies from state to state which is given as below:-<\/p>\n\n\n\n<table class=\"table table-bordered\"><tbody><tr><td>\n  <strong>State<\/strong><strong><\/strong>\n  <\/td><td>\n  <strong>Stamp Duty<\/strong><strong><\/strong>\n  <\/td><\/tr><tr><td>\n  Delhi\n  <\/td><td>\n  4% of the market value of property for Women6% of the market value of property for Man\n  \n  <\/td><\/tr><tr><td>\n  Uttar Pradesh\n  <\/td><td>\n  6% of the total value of the property for Women&nbsp;7% of the total value of the property for Man\n  \n  <\/td><\/tr><tr><td>\n  Karnataka\n  <\/td><td>\n  5.6% of the land value- Transfer is to non-family members.For the family members- range from Rs.1000\/- to 5000\/- which depends\n  upon the property location.\n  \n  <\/td><\/tr><tr><td>\n  Maharashtra\n  <\/td><td>\n  3% for the Family members 5% in the case of other Relatives &nbsp;Rs.200 in case if the residential property or the Agricultural land &nbsp;is gifted, \n  \n  \n  <\/td><\/tr><tr><td>\n  Gujarat\n  <\/td><td>\n  4.9% of the total value of property in Market.\n  <\/td><\/tr><tr><td>\n  West Bengal\n  <\/td><td>\n  0.5%&nbsp; for Family Members6% in any other case.1% of the surcharge above 40 lakh.\n  \n  \n  <\/td><\/tr><tr><td>\n  Tamil Nadu\n  <\/td><td>\n  1% for Family Members and&nbsp;7% for Other relatives\n  \n  <\/td><\/tr><tr><td>\n  Punjab\n  <\/td><td>\n  None \u2013 where in case of blood relativeOthers- 6% of value of the property.\n  \n  <\/td><\/tr><tr><td>\n  Rajasthan\n  <\/td><td>\n  4% and 3% in case of SC\/ST or BPL for Women5% for Man1% for the daughter or Wife 2.5% for close family members like son, daughter, father, mother,\n  in-laws, grandson or granddaughter\n  \n  \n  \n  <\/td><\/tr><\/tbody><\/table>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_to_Pay_Stamp_Duty_in_India\"><\/span>How to Pay\nStamp Duty in India?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><em><strong>The given below are the three ways by which a stamp charges are paid to the respective state government:-<\/strong><\/em><\/p>\n\n\n\n<ul><li>Stamp Paper- The stamp charge must be executed on non-judicial stamp papers and is paid directly to the registered authority. Both the parties shall put in writing the terms of the agreement on the document or in case of a gift deed, the property that is being gifted and get it signed. It is then recorded by the stamp vendor regarding details about the transaction &amp; the stamp purchaser and the same is mentioned at the back of stamp paper.<\/li><li>Electronic Stamping- The <strong><em>Government<\/em><\/strong><sup><a href=\"https:\/\/en.wikipedia.org\/wiki\/Government\"><strong><em>[1]<\/em><\/strong><\/a><\/sup> has introduced e-stamping with the objective to avoid fake stamp papers and to formulate easy      stamping. E-stamping is a more suitable way to pay stamp duty as stamping is done online. For e-stamping, the SHCIL (Stock Holding Corporation of India Limited) website shall be visited.<\/li><li>Franking-Franking is process in which the stamp duty is payable to the authorized banks having a franking centre. The documents are first prepared and then taken to the authorized bank which shall accept the stamp duty payment and then the bank shall stamp the paper to make it legal.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>There are numerous legal rules and procedures that should be complied with for a valid discharge of gifting a property to any person. Thus, it is important to understand the legal implications of a gift deed.  Therefore, the owner should mandatorily pay the stamp duty and complete all the specific procedure involved while making a gift of any property.&nbsp;  <\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/procedure-for-gift-deed-registration-a-step-by-step-guide\/\">Procedure for Gift deed registration: A Step By Step Guide<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Section 122 of the Transfer of Property Act provides with a definition of gift as a transfer of existing movable and immovable property which is made voluntarily and without any consideration. Hence, gift deed is a legal document that contains the voluntary transfer of gift from the donor (property owner) to donee (gift receiver) without [&hellip;]<\/p>\n","protected":false},"author":33,"featured_media":28253,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[1011],"tags":[1631],"acf":{"service_id":"284"},"authorName":"Kandarp Vanita","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/02\/image_2021_02_01T09_09_44_024Z.png","authorDescription":"Kandarp Vanita has done masters in Corporate and Commercial Law from WB National University of Juridical Sciences. She has 3 yrs of experience in drafting legal documents &amp; dissertations. Being a curious reader, she is also passionately into providing legal backups and comprehensive understandings in every aspect of Law to the firms.","postViews":16106,"readingTime":5,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/28211"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/33"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=28211"}],"version-history":[{"count":17,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/28211\/revisions"}],"predecessor-version":[{"id":28333,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/28211\/revisions\/28333"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/28253"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=28211"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=28211"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=28211"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}