/ Gift Deed Stamp Duty: Key Rules & Rates in 2025

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Gift Deed Stamp Duty: Key Rules & Rates in 2025

Updated on : 03 April 2025

By Hexadecimal Software Team

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1. What is a Gift Deed?
2. Is Stamp Duty Required for a Gift Deed?
3. Stamp Duty Rates for Gift Deeds in India (State-Wise)
4. Who is Liable to Pay Stamp Duty on a Gift Deed?
5. Stamp Duty Exemptions for Family Transfers
6. Gift Deed vs. Sale Deed vs. Will: Key Differences
7. How to Register a Gift Deed?
8. Documents Required for Gift Deed Registration
9. How to Save on Stamp Duty for a Gift Deed?
10. Legal and Tax Implications of a Gift Deed
11. FAQs

1. What is a Gift Deed?
2. Is Stamp Duty Required for a Gift Deed?
3. Stamp Duty Rates for Gift Deeds in India (State-Wise)
4. Who is Liable to Pay Stamp Duty on a Gift Deed?
5. Stamp Duty Exemptions for Family Transfers
6. Gift Deed vs. Sale Deed vs. Will: Key Differences
7. How to Register a Gift Deed?
8. Documents Required for Gift Deed Registration
9. How to Save on Stamp Duty for a Gift Deed?
10. Legal and Tax Implications of a Gift Deed
11. FAQs

What is a Gift Deed?

A gift deed is a legal document used to transfer ownership of property or assets from one person (donor) to another (donee) without any monetary exchange. It must be voluntary, without coercion, and registered to be legally valid. Stamp duty and registration charges apply based on state laws.

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Is Stamp Duty Required for a Gift Deed?

✅ Yes, stamp duty is mandatory under the Indian Stamp Act, 1899. Key points:

Stamp Duty is State-Specific – Rates vary across states and depend on property type.
Family Exemptions – Many states offer concessions if gifted to close relatives.
Mandatory Registration – A gift deed must be stamped and registered for legal validity.
Who Pays? – Typically, the donee (recipient) pays the stamp duty unless agreed otherwise.
Tax Implications – Gifts above ₹50,000 from non-relatives may be taxable.

Stamp Duty Rates for Gift Deeds in India (State-Wise)

State	Stamp Duty for Family Members	Stamp Duty for Others
Andhra Pradesh	1%	2%
Delhi	0.5% (Immediate Family Members)	6%
Gujarat	4.9% of Market Value	4.9% of Market Value
Karnataka	₹1,000 to ₹5,000 (Varies by Property Value)	5% of Market Value
Maharashtra	₹200 (Spouse, Children, Parents)	3% – 5% of Market Value
Tamil Nadu	1% of Property Value	7% of Market Value
Uttar Pradesh	₹5,000 for Family Members	7% of Market Value
West Bengal	0.5% for Blood Relatives	5% of Market Value
Punjab	N/A	6%
Rajasthan	Up to 4% for Women; Immediate Family – 2.5%	N/A

Who is Liable to Pay Stamp Duty on a Gift Deed?

✅ The donee (recipient) is generally liable to pay stamp duty unless there is an agreement stating otherwise.

Key Points:

Default Rule – The donee typically bears the stamp duty cost.
Mutual Agreement – The donor and donee can decide who pays.
State-Specific Rules – Some states may have unique policies on payment responsibility.
Mandatory for Registration – The gift deed won’t be legally valid without stamp duty payment.
Exemptions & Concessions – Some states offer reduced or waived stamp duty for family transfers.

Always check state-specific laws for exact rates and exemptions. 🚀

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Stamp Duty Exemptions for Family Transfers

✅ Many states in India offer stamp duty exemptions or concessions when property is gifted to close family members like:

Key Points	Details
Eligible Family Members	Spouse, children, parents, and sometimes siblings.
Full or Partial Exemptions	Some states charge a nominal fee or waive stamp duty completely.
State-Specific Benefits	Maharashtra charges just ₹200 for family gifts, while Delhi charges 0.5%.
Mandatory Registration	Even with exemptions, the gift deed must be registered.
Restrictions Apply	Exemptions may not apply to distant relatives or commercial properties.

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Gift Deed vs. Sale Deed vs. Will: Key Differences

Aspect	Gift Deed	Sale Deed
Consideration	No money involved.	Buyer pays money.
Stamp Duty	Applicable, varies by state.	Mandatory, based on value.
Registration	Mandatory.	Mandatory.
Revocability	Irrevocable.	Irrevocable.
Effectiveness	Immediate after registration.	Immediate after payment.
Purpose	Voluntary transfer.	Sale for money.

How to Register a Gift Deed?

Step	Process
1. Draft the Deed	Prepare a gift deed with donor, donee, and property details.
2. Stamp Paper	Buy stamp paper as per state laws.
3. Sign with Witnesses	Both parties sign the deed in the presence of two witnesses.
4. Submit to Registrar	Visit the sub-registrar office with required documents.
5. Pay Fees	Pay applicable stamp duty and registration charges.
6. Verification	Complete biometric verification and signatures.
7. Collect Deed	Receive the registered gift deed after approval.

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Documents Required for Gift Deed Registration

Document	Purpose
Gift Deed	Legally drafted document mentioning donor, donee, and property details.
Identity Proof	Aadhaar card, PAN card, or passport of both donor and donee.
Property Documents	Original sale deed, title deed, or any proof of ownership.
Encumbrance Certificate	Confirms the property is free from legal dues or disputes.
Stamp Paper	As per state-prescribed stamp duty for legal execution.
Address Proof	Utility bill, ration card, or passport for both parties.
Photographs	Passport-size photos of donor, donee, and witnesses.
Witness ID Proof	Aadhaar card, voter ID, or passport of two witnesses.

How to Save on Stamp Duty for a Gift Deed?

✅ Follow these strategies to reduce stamp duty costs:

Gift to Family Members – Many states offer reduced or zero stamp duty for gifts to spouse, children, parents, or close relatives.
Check State Concessions – Some states have fixed minimal charges for family transfers (e.g., Maharashtra charges only ₹200).
Gift Agricultural Land – Stamp duty on agricultural land is lower than residential or commercial properties in many states.
Register in a Low-Duty State – If legally possible, register the gift deed in a state with lower stamp duty rates.
Opt for Nominal Consideration – Instead of a full gift, some states allow transfers with a nominal amount, reducing stamp duty.
Consult a Legal Expert – A lawyer can help you identify exemptions or legal methods to minimize stamp duty costs.

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Legal and Tax Implications of a Gift Deed

(I) Legal Implications

Legal Aspect	Details
Irrevocable	Once registered, it cannot be revoked except in rare cases.
Mandatory Registration	Required under the Indian Registration Act, 1908.
Stamp Duty	Must be paid as per state-specific rates.
Voluntary Transfer	Gift must be given without coercion or fraud.
Donee’s Rights	Donee becomes the full legal owner after acceptance.

(II) Tax Implications

Tax Aspect	Details
Family Gifts	Tax-free if given by relatives (spouse, parents, children, etc.).
₹50,000 Limit	Gifts above ₹50,000 from non-relatives are taxable.
Property Taxation	If undervalued, it may be taxed under Section 56(2)(x).
Capital Gains	Donor is exempt, but donee pays tax on future sale.
Inheritance vs. Gift	Inheritance is tax-free, but non-relative gifts are taxable above ₹50,000.

FAQs

Que: Is stamp duty mandatory for a gift deed?
Ans: Yes, stamp duty is mandatory and varies by state and relationship between donor and donee.

Que: Can a gift deed be revoked after registration?
Ans: No, a registered gift deed is generally irrevocable unless proven fraudulent or challenged in court.

Que: Are gifts between family members exempt from stamp duty?
Ans: Some states offer full or partial exemption for gifts between close family members like spouse, parents, or children.

Que: Do I need to pay income tax on a gifted property?
Ans: Gifts from relatives are tax-free, but gifts from non-relatives above ₹50,000 are taxable as "Income from Other Sources."

Que: Is registration of a gift deed compulsory?
Ans: Yes, a gift deed must be registered with the sub-registrar to be legally valid and enforceable.

Que: Who pays the stamp duty for a gift deed?
Ans: The donee (recipient) usually pays the stamp duty unless otherwise agreed between the parties.