You want to present a house you own to your children, grandchildren or other lucky person, but you have no idea what to do under such circumstances? Let’s have a little insight into the procedure.
Firstly, we must state that donation, or deed, as it is commonly called, is drawn up in the form of a notarized deed of gift. The main discrepancy between a deed of gift and other agreements is its GRATUITOUS nature. When a deed of gift is concluded, your ownership right is ceased, and it arises for a donee; in turn, a donee is not obliged to any actions in your favour.
Whereas a deed of gift is a gratuitous agreement, you may not oblige a donee to fulfil any actions in your favour, material or non-material.
When formalizing a deed of gift of a house, one should not forget about a land plot where a house is located. Our legislation stipulates no instances when a land plot is owned by one person and a house located in it by the other person.
In case a land plot is privatized and belongs to a house owner, the title to the house must be re-registered simultaneously with a title to a land plot. I.e. apart from a deed of gift of a house, you need to formalize a deed of gift of a land plot.
A land plot may be assigned to a house owner for temporary use from communal ownership. In such case a deed of gift of a house includes the description of this land plot, its cadastral number; there is no need to formalize a separate deed of gift of a land plot.
Nowadays, when notarizing a deed of gift of a house, a notary simultaneously registers an ownership right of a new owner in the State Register of Proprietary Rights. I.e. a donee leaves a notarial office as a rightful owner of a house, and there is no need for you to register your ownership right at any other authorities.
In the process of notarization of a deed of gift, a notary carefully examines all documents submitted for conclusion of a deed, availability of any freeze or prohibition of alienation of the respective house, verifies a power of attorney (if an agreement is concluded by a representative).
It should be mentioned that for notarization of a deed of gift where the parties are the immediate family members (according to the legislation, those are parents, spouse, children, including adopted children) an income received as a gift is subject to zero rate taxation. If a deed of gift is in favour of other persons, a tax amount constitutes 5%.
Please note that both a Doner and a Donee must apply to a notary to conclude a deed of gift. Their attendance in person at the moment of deed is a prerequisite to its notarization.