Registeration of gift deed
Dhirender Wadhwa
(Querist) 17 January 2013
This query is : Resolved
Respected experts...
My brother, who now lives in other country and has taken the citizenship there, owns a house here in india. He is finding it complex to indulge in taxation procedures here as the house is used for renting and thus income is generated.
He wants to transfer the said property in my name as a Gift (actually for safe keeping and to save the complexity of taxations due to its rental use)
QUESTION : Is it necessary to register a gift deed with complete stamp duty or a notarised gift deed on lower stamp paper work the same as we have no issues between us and are not willing to pay the high stamp duty involved.
I have been advised to get a SPA/GPA made, but will i be able to include the income as my income for taxation by force of such a document
ajay sethi
(Expert) 17 January 2013
dont be penny wise and pound foolish . indorder to save some money you are not taking legal precuations .
gift deed has to be stamped and regd . gift attracts nomial 2%stamp duty . notarised gift deed wont work .
Anirudh
(Expert) 17 January 2013
Dear Mr. Dhirender,
(1) By getting SPA/GPA you will only be an agent of your brother. Therefore the said income by way of rent of the said property cannot be included in your income, it will continue to be treated as the income of your brother only.
(2) As regards Gift, it has to be got registered by paying applicable stamp duty. Without registration, the GIFT has no validity. Simple notorisation will not do.
(3) Once a properly registered GIFT deed is given in your favour, the property will become yours and your brother will permanently lose his right over the same. (The said gift will not be treated as for sake keeping or for the purpose of saving complexity of taxation etc. - Again as far as law is concerned - whether or not you have any issues between both of you whether now or in future - the property will become yours, unless again you gift back the property to your brother as and when he asks for the same by once again paying the applicable stamp duty at that time).
If the arrangement is required only for the purpose of avoiding complexity of taxation, your brother would be better advised to take the services of a chartered accountant who will do the needful.
In your anxiety to avoid complexity and save money (not tax), you should not create problems for yourselves, which could be surely handled better by engaging a chartered accountant.
Dhirender Wadhwa
(Querist) 17 January 2013
Thanks Anirudh ji & Ajay ji..
but i was told that 7% stamp duty is to be paid for gift deed as per the valuation of the property as against 2% as suggested by Mr. Ajay...
Kindly clarify the stamp duty rate on gift deed and whether it is on current valuation or as per the registry in favour of the donor ??
H.M.Patnaik
(Expert) 17 January 2013
You have to indicate the state & place where the property in question is situated, so that one can advise you reg. the Regn. fees .
As regards filing of Income tax return by a Non-resident, you can contact a local tax consultant who would guide you how a Representative Assessee can file the return in india on behalf of any taxpayer.
Dhirender Wadhwa
(Querist) 21 January 2013
sir, the registry is in Ghaziabad (UP)
H.M.Patnaik
(Expert) 21 January 2013
you have to be in touch with the local Sub -Regisrar's office at Ghaziabad to ascertain the quantum of fee for Regn. of Gift Deed.The same would also be available in the info portal of Revenue Deptt. of the state.
