Lifetime Gifts of Property
Giving property to a family member during your lifetime, and making sure the gift is completed on the register.
A hibah is a gift made during your lifetime. For land it only takes effect when the transfer is registered. A gift document without registration does not change the registered proprietor, and the property stays part of the estate.
Many families plan to give a home to a child during their lifetime to avoid a dispute after death. The intention is right. What is usually left undone is the final step.
Registration is the step that counts
For land, ownership follows the register. A gift document that is signed but not followed by a registered transfer does not change the registered proprietor.
When the giver dies, the property is still in their name and forms part of the estate, even though the family believed it had been given away. These are difficult to unwind after a death.
Where the property is still charged
If the property remains under charge, the transfer needs the bank’s consent. In some cases the loan has to be redeemed or restructured first. This should be checked before anything is promised to the recipient.
The effect on other family members
A lifetime gift reduces what remains in the estate. We encourage givers to think that effect through in advance, because family disputes after a death often start with a gift nobody discussed.
The actual steps
- Title search for restrictions, charges and caveats
- Authority consent where the title is restricted
- Bank consent where the property is charged
- Preparation and stamping of the transfer documents
- Registration of the transfer at the land office
What your lawyer handles
- Checking the title for restrictions, charges and caveats
- Advising on the effect of the gift on other family members
- Preparing the transfer and supporting documents
- Obtaining authority consent where the title is restricted
- Dealing with the bank where the property is still charged
- Attending to stamping and registration of the transfer
Documents you need to prepare
- Copies of the giver's and recipient's identity cards
- Copy of the title
- Proof of the family relationship
- Redemption statement where the property is charged
- Current quit rent and assessment receipts
Costs people often overlook
- Legal fees for preparation and registration
- Stamp duty under the treatment that applies to transfers between close family
- Land office registration fees
- Service tax of 8% on legal fees
When to stop and get advice first
- A gift document signed but the transfer never registered
- A property still charged, with no bank consent obtained
- Restrictions on the title requiring authority consent
- A giver parting with their only home without an alternative plan
- Other family members not told, so a dispute follows later
Frequently asked questions
Is the gift document alone enough?
For land, no. Until the transfer is registered, the registered proprietor is still the giver and the property remains part of the estate.
The property still has a loan. Can it be gifted?
The bank's consent is needed. In some cases the loan has to be redeemed or restructured first.
Is stamp duty payable on a gift to a child?
Transfers between close family attract particular stamp duty treatment. Eligibility and the current rate are confirmed at the time of the transaction.
Can a gift be revoked?
It depends on the form of the gift and whether it has been perfected. Take specific advice.
Ready to start your property matter?
An initial consultation with no obligation. Tell us about your matter and we will explain what is involved and what it is likely to cost.
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