A Bengaluru father wanted to pass his flat to his daughter and assumed it would cost the same duty as any transfer, a large percentage of the value. His lawyer corrected him in a sentence. Done as a gift deed between father and daughter in Karnataka, the stamp duty was a fixed few thousand rupees, not the five percent a sale would attract. On a flat worth two crore, that was the difference between a few thousand rupees and something close to fourteen lakh. The property moved the same way, into the daughter's name by a registered deed, but the label on the deed, gift rather than sale, changed the cost by almost everything.

The short answer. A gift deed transfers property without any money changing hands, while a sale deed transfers it for a price. In Karnataka this distinction has a dramatic cost effect for families: a gift to a specified family member attracts only a fixed nominal stamp duty of a few thousand rupees, instead of the five percent of value a sale deed attracts. Both are registered conveyances that transfer ownership, and both are compulsorily registrable. The catch is that the concession applies only to defined relatives, and a gift to anyone outside that list is stamped at the full rate, the same as a sale. The trade off is that a gift is a genuine, and generally irrevocable, transfer with no money coming back, so it suits a family handover rather than a commercial deal.

What is the difference between a gift deed and a sale deed?

A gift deed conveys property voluntarily and without consideration, whereas a sale deed conveys it in exchange for a price. In a sale, money passes from buyer to seller and the deed records that consideration; in a gift, the owner transfers the property out of natural love and affection or goodwill, and no payment is involved. Both are registered instruments that actually transfer ownership, unlike a mere agreement, and both must be registered to be effective. The absence of consideration is not a technicality: it defines the gift and it drives the different stamp treatment, and it means a gift, once made and accepted, is not a transaction the giver can simply undo because they changed their mind. For a family transfer, the gift deed is the instrument built for the situation, while the sale deed is built for a deal at a price.

Why is a family gift so cheap to stamp in Karnataka?

Because Karnataka charges a fixed, nominal stamp duty on a gift to a specified family member, rather than the percentage of value it charges on a sale. The table below sets the two instruments side by side on the points that matter.

The single line that saves families lakhs is the second: within the defined relations, the gift is stamped at a fixed nominal figure regardless of the property's value, so a high value flat costs the same modest duty as a modest one. Because the exact fixed amount can be revised, confirm the current figure for a family gift on the official Karnataka registration portal before you rely on a number.

Who counts as family for the concession?

The concession applies only to a defined set of close relatives, and a gift to anyone outside that set is stamped at the full rate. Under the Karnataka framework the specified relations typically include a spouse, son, daughter, daughter in law, father, mother, brother, sister and grandchildren, and a gift between these attracts the nominal duty. A gift to a cousin, a nephew, a friend or any relation not on the list is treated like a transfer to a stranger and stamped at the full five percent of value, which removes the whole advantage. This is why the exact relationship matters so much: the same generous intention costs a few thousand rupees within the family and lakhs just outside it. Before planning a gift, confirm that the intended recipient falls within the specified relations, and if they do not, weigh whether a gift is still worthwhile once the full duty is added.

Is a gift deed reversible, and what makes it valid?

A gift, once validly made and accepted, is generally irrevocable, so it should be treated as a final decision rather than a loan of ownership. For a gift to be valid it must be made voluntarily and without consideration, the donee must accept it during the giver's lifetime, and the deed must be registered. A giver cannot usually take the property back later simply because relations have soured or circumstances changed, unless a specific lawful ground applies, so a gift deed is not a device to move a property temporarily. This finality is a feature, not a flaw, since it gives the recipient a clean, settled title, but it means the giver should be certain before signing. Where any condition is intended, it needs to be expressed carefully in the deed, because a plain gift, once accepted and registered, passes the property fully and for good. There is a tax dimension worth knowing too: a gift between specified relatives is generally not taxed as income in the recipient's hands, but when the recipient later sells, the capital gain is usually worked out from the original owner's cost and holding period, not from a fresh value at the date of the gift, so the tax on a future sale can be larger than a new owner expects.

What should a buyer check if a property was gifted?

If a property in the chain came through a gift deed, a buyer should confirm the gift was valid, accepted and unconditional, because a defective gift can weaken the title you are buying. Check that the gift deed was registered, that it was between parties consistent with a genuine transfer, and that the donee accepted it, since acceptance during the giver's lifetime is part of what makes a gift good. Look also for any conditions attached to the gift, because a conditional gift can carry limits that follow the property, and for the possibility of a challenge by others who feel they had a claim. This is really an extension of ordinary title diligence: a gift in the chain is not a problem in itself, and family gifts are extremely common in Karnataka precisely because of the concession, but like any link it should be read rather than assumed. A clean, registered, accepted gift is as good a root of title as a sale deed, and it deserves the same reading rather than either suspicion or a free pass.

How do I choose between a gift and a sale for a family transfer?

Match the instrument to the intention, and let the relationship and the money decide.

1. Decide whether any money is actually changing hands, which points to sale or gift.
2. Confirm the recipient falls within Karnataka's specified family relations for the concession.
3. For a genuine family handover with no price, consider a gift deed for the nominal duty.
4. Check the current fixed stamp duty for a family gift on the official portal.
5. Remember a gift is generally irrevocable once accepted, so be certain before signing.
6. Take advice on capital gains, since the recipient inherits the original cost on a later sale.
7. Register the deed, gift or sale, because only a registered conveyance transfers title.

How does this fit stamp duty and the sale deed?

A gift deed is the low cost cousin of the sale deed for family transfers, so it sits directly alongside the duty and the deed a buyer already knows. Our guide to Karnataka stamp duty and registration charges explains the five percent that a sale attracts and that a non family gift also pays, which is the very cost the family concession avoids. And our note on the sale agreement and the sale deed covers how a registered deed, whether gift or sale, is what actually transfers ownership. When you buy in the market, such as a flat in a project like Aparna Wonderwoods in Mallasandra, the instrument is a sale deed at full duty; the gift deed is for the family handover, not the market purchase. Knowing which deed fits which situation is what keeps both the cost and the title right.

Frequently asked questions

What is the difference between a gift deed and a sale deed? A gift deed transfers property voluntarily and without any money changing hands, while a sale deed transfers it for a price. Both are registered conveyances that actually transfer ownership and both must be registered. The absence of consideration defines a gift, drives its different stamp treatment, and makes it generally irrevocable once accepted.

How much stamp duty is a family gift in Karnataka? A gift to a specified family member attracts only a fixed nominal stamp duty of a few thousand rupees, rather than the five percent a sale deed attracts, so a high value flat costs the same modest duty as a small one. Because the exact fixed figure can change, confirm the current amount on the official Karnataka registration portal.

Who qualifies as family for the gift concession? A defined set of close relatives, which under the Karnataka framework typically includes a spouse, son, daughter, daughter in law, father, mother, brother, sister and grandchildren. A gift to anyone outside these relations is stamped at the full five percent of value, the same as a sale, so confirm the exact relationship before relying on the concession.

Can a gift deed be cancelled later? Generally no. Once a gift is validly made, accepted by the recipient and registered, it is irrevocable, and the giver cannot usually take the property back merely because circumstances or relations changed. A gift deed should be treated as a final transfer, and any intended condition must be expressed carefully in the deed itself before it is signed.

Last updated 2026-08-30. PropNewz Team.