Gift Deed Vs Will Which Is Better ?
10/10/2020 Notary Lawyers

Property and land are real estate and can be used for a long time. Real estate can also be transferred to anyone you want to donate, which can be one of your family members, friends or even charities, which is in line with the common rules of inheritance. Whenever a property transfer occurs, costs and legal procedures are involved. So how to transfer ownership? Well, there are two main options-through a gift deed or a will.

Understand the salient features of the two methods of property transfer.


 

Gift Deed

You may gift your self-acquired property to anybody, as long as you are qualified to enter into a contract in compliance with the law of the country in effect.

 

The Key Points To Remember

  • The Donee has to consider your gift. 

  • A gift deed is not mandatory but brings clarity. 

  • There are no taxes to be paid if the gift is made to relatives. However, stamp duty and registration fees may have to be charged in order to make the move legal. 

  • In case of a gift made to non-relatives over Rs 50,000, the beneficiary  will have to pay

  • A gift once made is irrevocable

  • Gifts can be used as a way to transfer property during an individual’s lifetime.


 

Will

Unlike the gift contract, the gift contract makes the recipient become the owner of the property during the transferor's existence. On the contrary, the will only allows the transfer of ownership after the death of the person executing the will. Under current law, you do not have to register a will or pay any stamp duty for it.

 

The Key Points To Remember

The registration of a will is not mandatory, but it can avoid future litigation.

 People who acquire property through a will do not have to pay any taxes.

 After the death of an individual, according to the national inheritance law, even if there is no will, the property can be transferred to the heir. 

In the life of the person who drafted the will, the will can be revoked or replaced many times.


 

Gift Or will: Which Is Better?

Now that you have understood the core characteristics of the deed of gift and will, let us analyze the two options and evaluate which option is best for you when transferring property.

If you want the recipient to immediately benefit from the property transfer, the gift deed is an ideal choice. However, for those who wish to transfer their assets to the desired recipient only after death, transferring the property through a will is a better option for them. 

The answer to the question lies in the purpose, priorities and circumstances behind the property transfer. Regardless of your preferred method of property transfer, please follow the rules and be extra careful when executing your will or gift deed.