Definition
Gift Deed
A gift deed is a legal document used to voluntarily transfer ownership of property or money from one person (the donor) to another (the donee) without any consideration in return.
For immovable property, a gift deed must be in writing, signed, attested by witnesses, and registered, with applicable stamp duty paid — though many states levy reduced stamp duty when the gift is to close relatives. A registered gift deed gives the donee clear title and is harder to challenge than an informal transfer.
Tax matters too: gifts received from specified close relatives are exempt from income tax in the donee's hands, whereas gifts from non-relatives above a threshold are taxable. Gift deeds are commonly used for estate planning — passing property to children or a spouse during one's lifetime — but the transfer is generally irrevocable once completed, so it should be done deliberately.
Related terms
- Stamp Duty and Registration ChargesStamp duty and registration charges are state government levies paid when buying property — a transaction tax plus a fee for officially recording the transfer.
- Will (Testament)A will is a legal document in which a person states how their assets should be distributed after death and who should carry out those wishes.
- HUF (Hindu Undivided Family)A Hindu Undivided Family (HUF) is a separate entity under Indian tax law, consisting of family members descended from a common ancestor, that can own assets and be taxed in its own right.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.