Gift Deed and Will: Two Different Ways of Passing Property On
Both are ways of passing property to someone without a sale, and they are often discussed as alternatives. They work quite differently: one takes effect now and cannot usually be undone, the other takes effect on death and can be changed until then. This note sets out what follows from that difference.
Guide
The difference that governs everything else
A gift deed transfers property during the lifetime of the person making it. Once it is made and accepted in the manner the law requires, the property has moved. A will disposes of property on death and has no effect at all while its maker is alive.
Almost every practical difference between the two follows from that. Control, revocability, the ability to change one's mind, what happens if relations sour, and who has to do what afterwards are all determined by whether the transfer has already happened or is still to come.
Control and the ability to change your mind
A will can be revoked or replaced by its maker at any time while they retain capacity. Nothing is fixed until death, which is precisely why a will suits a person who wants to provide for someone without giving up anything now.
A gift, once complete, is generally not revocable at the giver's will. There are limited circumstances in which a gift may be set aside, and they are narrow and fact-specific. A person considering a gift should proceed on the basis that it cannot be undone because they have changed their mind, and should take advice before assuming otherwise.
Formalities, and why they are not interchangeable
A gift of immovable property has to be made by a registered instrument and has to be accepted by the person receiving it during the giver's lifetime. Acceptance is a real requirement, not a formality, and where it is in doubt the gift itself is in doubt.
A will has its own requirements as to execution and attestation, which differ from those for a gift and are not satisfied by following the gift procedure instead. What formalities apply to a particular person's will can also depend on the law of succession applicable to them, and that should be established rather than assumed.
What has to be done afterwards
After a gift, the property is the recipient's, and the ordinary consequences follow: the records are updated, the property tax follows the new holder, and the recipient may deal with the property as an owner.
A will produces no such immediate step. On death, whoever takes under it has to establish that they do, and what is required for that — and whether any court process is involved — depends on the applicable law of succession and on where the property is. A will is not automatically self-executing, and the assumption that it is causes a great deal of avoidable difficulty.
Conditions, retained rights and disputes
A giver who wants to transfer property but continue to live in it, or to retain some benefit from it, is describing a more complicated arrangement than a simple gift, and one that has to be drafted deliberately. An arrangement of that kind that is agreed orally and reflected nowhere in the deed is the most common source of dispute in this area.
Both gifts and wills are challenged, and on similar grounds: that the maker did not understand what they were doing, that they were pressured into it, or that the document is not genuine. What reduces that risk is contemporaneous care — that the maker's understanding is real, that the document says what they actually intend, and that the circumstances of execution are properly recorded.
Checklist
Practical Checklist
- Decide when the transfer should take effectNow, or on death. That single question determines which instrument is being discussed.
- Confirm what the giver actually wants to keepA right to reside, an income, or control over a later sale — each has to be drafted for, not assumed.
- Establish the applicable law of successionIt can affect what may be disposed of, and what formalities apply.
- Check the property can be dealt with in this wayJointly held, ancestral or restricted property may not be freely transferable by one person.
- Deal with acceptance where it is a giftAcceptance during the giver's lifetime is a requirement, and should be capable of being proved.
- Attend to execution properlyExecution and attestation done carefully, with the circumstances recorded, is what answers a later challenge.
- Plan the step that followsUpdating of records after a gift; and, after a will, what those who take under it will have to establish.
Cautions
Common Mistakes
- Assuming a gift can be taken backIt generally cannot, simply because the giver has changed their mind. Advice should be taken before, not after.
- Making a gift subject to an oral promiseA promise to look after the giver, or to let them stay, that appears nowhere in the deed is very difficult to enforce.
- Writing a will without regard to the applicable lawWhat a person may dispose of, and how, is not the same for everyone. A will drafted on a general assumption may not do what it intends.
- Assuming a will operates by itselfThose who take under it may still have to establish their entitlement, and that is easier to plan for than to improvise.
- Not thinking about capacity and pressureThese are the grounds on which such documents are attacked. Care taken at the time is what answers them later.
- Using one instrument to do the other's workA document that purports to give property away now but is meant to operate on death is likely to fail as both.
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About this note
Published by H.R. Legal Associate, advocates, Lucknow, for general information.
Written byH.R. Legal Associate
Date published
Date reviewed
Important
Disclaimer
This note is general information about an area of law. It is not legal advice, it is not an advertisement or a solicitation of work, and reading it creates no advocate–client relationship.
The law of succession applicable to a person, what property they may dispose of, and the formalities required for a gift or a will are matters that vary with the person and the property. The position should be established on the particular facts before either document is prepared.
Procedures, limitation periods, court fees, stamp duty, government charges and tax rates change, and what applies depends on the facts of the particular matter. Nothing here should be acted on without advice taken on your own documents, and no outcome is promised or predicted.
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