Why You Should Use A Will To Gift Property To Your Children

A gift deed is a legal instrument that allows the transfer of movable or immovable property to the recipient. Gifting of a property through deed comes under the Indian Contract Act 1872 and the Transfer of Property Act 1882. The donee receives full income tax exemption except for a marginal stamp duty under the Indian Stamp Act. The stamp duty amount varies across states. For example, the stamp duty in Mumbai is flat Rs 75,000. Gift deeds can be completed within a week, compared to 8-12 months for a Will. Gifting a property through a will is better than a deed as it allows for changes later. It is not possible in a gift deed as it is already fixed. Also, the receiver of the property may force you to move out of the house.

How To Make A Strong Will?

When transferring property to children through a gift deed, ensuring the agreement protects both parties is crucial. The parent must establish a condition for the children, asserting their right to continue using the gifted residential property until their death. Additionally, consider being a joint holder in the property instead of giving it away entirely.

How To Revoke A Gift Deed?

Parents can revoke a gift deed if it contains specific clauses stating a child's duty to upkeep and maintain their parents with dignity, providing basic amenities, and fulfilling physical needs. If these conditions are not met, the gifting can be considered under coercion, undue influence, or fraudulent activity. Parents can apply for reclaiming property at a maintenance tribunal court, which is faster and quicker in resolving disputes. The maintenance tribunal must dispose of the matter within 120 days of being notified. The Maintenance and Welfare of Parents and Senior Citizens Act, 2007 ensures protection to senior citizens and reduces litigation battles with their children. If the donee is unwilling to give back the property gifted, a lawyer can be approached to fight the case in court. If an appointed attorney cannot enforce rights for declaring the property transfer as void due to illness or ageing, the facts must be presented to the maintenance tribunal.

A Will Is Better Than A Deed

In a Will, the property continues to be in your name, whereas, in a gift deed, the property is transferred the moment you conclude the deed. So, it is advisable to leave transfer your property to children through a will rather than a gift deed, especially if you also live in that property.

A will is a more effective method for property transfers after death, as it allows you to specify asset division and distribution, takes effect only after death and ensures your wishes are carried out correctly. It also offers flexibility to change plans and allows you to appoint an executor to handle your estate according to your instructions.