Pros and cons of deed of gift for an apartment, house, car

Donation is a type of transaction under which citizens can transfer real estate into ownership of each other. This form of agreement is especially noteworthy for close relatives, since they are exempt from the obligation to pay income tax in the amount of 13% .

Just like a will, a donation implies gratuitous alienation of property , however, each of such transactions has its pros and cons. Depending on the situation, the number of heirs and other factors, citizens have the right, at their own discretion, to choose the most appropriate method for transferring their property. In order to understand which option is most advisable to use, it is worth understanding the key features of each transaction.

Features of the gift agreement

The gift agreement (hereinafter referred to as the DD) is concluded orally or in writing, the specifics are regulated by Ch. 32 of the Civil Code of the Russian Federation. If the transaction is made orally, it is considered completed upon the delivery of the gift, keys or title documents. When executed in writing, execution begins from the moment specified in the deed of gift.

Note! A written DD may contain a condition for the promise of a gift. In this case, the recipient will receive a gift upon the occurrence of a specific date or event: wedding, graduation, etc.

Written form is required if the donor is a legal entity and the value of the gift exceeds 3,000 rubles, and in other cases:

• real estate is donated;
• the contract contains a promise of a gift in the future.

In other situations, it is enough to give the gift orally.

An exception is the donation of a vehicle: according to the law, a written DD is not required, but the recipient will need it in the future to register the car with the traffic police.

Conclusion

Giving is considered a simple transaction. Perhaps you can do the design yourself. If you feel you need help, contact a notary or a trusted real estate agency. If you don’t want to “fool” with documents, contracts, and so on, find an agency that will handle the transaction from start to finish. The gift agreement, like any other official document, must be drawn up correctly and competently. In the future, a responsible approach will ensure that controversial issues will not arise.

To whom and what can you give?

For the transaction, the donor only needs to have ownership of the gift and be fully capable.

The recipient can be any person chosen by the owner of the gift:

• close or distant relative;
• boyfriend/girlfriend;
• other individuals;
• entity.

Important! Property of children under 14 years of age cannot be given as a gift. If the child has reached the specified age, the consent of the parents and guardianship authorities will be required for donation (except for small gifts). Minors under 14 years old can accept gifts, but with the permission of their legal representatives.

Now let’s briefly look at the list and features of giving different gifts:

1. A private house. It is given only together with the land plot on which it is built.
2. Apartment or share in an apartment. In the latter case, it is not necessary to obtain the consent of other owners for the transaction, but the DD must be certified by a notary.
3. Vehicle: car, truck, bus, motorcycle, etc.
4. Share in the authorized capital of LLC. If this is provided for in the charter, you will have to obtain consent to the transaction from the remaining owners of the company.
5. Jewelry.
6. Household appliances, electronics, tools, electrical appliances.
7. Money (cash, in a bank account).

Thus, you can give any thing, but that’s not all. The law allows for the gift of the right to claim a debt from a third party, or vice versa - the gift of the assumption of obligations to repay debts by the donor by transferring them from the donee. In the first case, you need to notify the debtor’s creditor of the change, in the second, you need to agree on a deal with the donee’s creditor.

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Pros and cons of deed of gift

The main advantage of drawing up a deed of gift is tax exemption. This is true if the transaction is made between close relatives. Donees will not have to pay personal income tax in the amount of 13% when receiving a gift of real estate, vehicles, shares, shares, shares.

Other persons who are not relatives of the donor must pay taxes.

Let's consider the remaining pros and cons of the gift agreement in detail:

Pros and cons of a gift deed compared to a will

The will must be certified by a notary, and the owner of the gift will have to bear the costs in any case. In addition, regardless of the expression of will, there are citizens who are allocated a mandatory share in the property.

But there are also advantages:

• until death, the testator has the right to use the bequeathed property;
• heirs do not pay personal income tax;
• you can change or cancel a will at any time;
• the testator does not have to tell the heirs about the existence of the document.

There are also advantages to a gift agreement. It is more beneficial to the donee, who receive the property almost immediately, and not after the death of the owner. Relatives do not pay taxes when receiving a gift.

Thus, a DD is more beneficial to the donee, and a will is more beneficial to the donor, who transfers the property free of charge, but after his death.

Let's sum it up

Registration of a deed of gift is not a complicated process, but it requires a careful analysis of the benefits and disadvantages of the transaction.

In general, the advantages include:

• simplicity and speed of property re-registration,
• no tax when concluding an agreement between close relatives.

Disadvantages: 13% tax when drawing up an agreement is not in favor of relatives and the impossibility of obtaining a tax deduction.

About the author of the article

Alexander Borisovich Bukashka Allow me to introduce myself: Bukashka, Alexander Borisovich. A native Petersburger. I know how to defend my rights and understand document flow.

Procedure for drawing up a donation agreement

The procedure for drawing up a written DD, regardless of the gift, looks almost the same, with the exception of cases where the agreement must be certified by a notary.
Let's look at everything step by step:

1. Discussion of the transaction with the donee. This is important because he has the right to refuse.
2. Collection of documents. Both parties prepare them independently.
3. Drawing up a deed of gift. You can do this yourself, order a service from a notary, or contact a lawyer. In the latter case, it will be cheaper compared to a notary office.
4. Signing the contract. Both parties must be present. If the donor or recipient cannot be present, the signature is placed by the legal representative on the basis of a notarized power of attorney. A certificate of gift will be required when alienating a share in property rights, making a gift on behalf of a minor, or the presence of attorneys in the transaction.

Further actions depend on what exactly was donated.

Documentation

Before signing the DD, you need to prepare documents - they will be needed to fill out the agreement:

• passports of all participants;
• real estate was donated: certificate of ownership or extract from the Unified State Register of Real Estate, technical documents;
• donated vehicle: STS, PTS;
• upon alienation of a plot of land: cadastral passport, extract from the Unified State Register of Real Estate;
• donated bank deposit: certificate from a financial institution.

Important! If a car or housing is given as a gift, a document must be provided confirming the basis for the donor’s ownership rights. This could be a contract of sale, exchange, gift, certificate of inheritance, etc.

What to do after completing the deed of gift?

The further procedure after signing the DD depends on the type of gift. If a vehicle is donated, you must contact the traffic police within 10 days to register it. Before this, compulsory motor liability insurance is purchased and a technical inspection is carried out.

When receiving real estate as a gift, you must submit registration documents to Rosreestr or MFC. The owner will be changed within 10 days, after which you need to receive an extract.

An alternative option is to submit documents to Rosreestr through a notary, if the DD is certified at a notary’s office. Since 2019, this service is provided free of charge.

If the donee is not a close relative of the donor, when receiving real estate, a car, shares, shares, you must provide a tax return 3-NDFL by April 30 of the year following the date of the transaction. After reconciliation, a tax of 13% of the price of the donated property is paid by July 15. If the specified dates fall on weekends, the deadline for submitting a declaration or paying personal income tax is postponed to the next weekday.

Lawyer's answers to frequently asked questions

I want to sell an apartment, but not pay taxes on the purchase and sale agreement. Is it possible to issue a deed of gift?

Formally, this is possible, but you need to take into account the risks: if you issue a deed of gift to the buyer, there is a high probability that he will not give the money in return. By law, such transactions are considered sham (Article 170 of the Civil Code of the Russian Federation) and are declared invalid by the courts upon claims of interested parties.

I can draw up a gift agreement, but with the condition that the donee will support me for life?

No, donation with a counter condition is prohibited. It is better to draw up an annuity agreement (Article 583 of the Civil Code of the Russian Federation).

How does a gift agreement differ from an annuity agreement?

By deed of gift, property is transferred free of charge. Under the annuity agreement, the recipient transfers the property to the payer, but he undertakes to provide maintenance in cash or other form.

Do families with many children have any benefits when applying to a notary?

No. According to Art. 333.38 of the Tax Code of the Russian Federation, benefits are provided to disabled people of groups 1 and 2, state and municipal authorities, public organizations of disabled people and other persons.

Is it possible to expel the donor from the donated apartment if he does not agree?

Yes. You should go to court.

Taxation

The main advantage of a deed of gift drawn up between close relatives - the absence of taxation on gifts - has appeared since 2006. The Family Code clearly defines close and distant relatives. The following are considered close:

• legal husband and wife;
• granddaughters and grandchildren;
• grandparents;
• brothers and sisters, relatives from both parents or only one, as well as adopted ones;
• parents, not excluding adopted ones.

All the rest are distant relatives and are not exempt from the thirteen percent gift tax. If a deal is concluded with a citizen of another country, he will have to pay thirty percent of the estimated value of the donated apartment to the Russian budget.