Yes you can execute a registered trust deed and do the aforesaid
Transfer of property (building) to spouse
My wife and I jointly own a commercial property in India. We both are US citizens. We acquired and built this property before we became US Citizens. I am now planning on transferring my share of the property to my Wife thereby my wife will assume 100% ownership of the property. What is the best possible way of transferring the property? Can I do the transfer of property through a gift deed and what would be the procedure and taxes involved? Is this something attorneys will represent or CPA's. Please advise. Alternatively can I move the property to a trust and make my wife and kid as the trustees? and what would be procedure/ advantages or disadvantages in this case? Please advise the best option in our case. Goo day and look forward to your best advise and suggestions.
Asked 3 years ago in Property Law
Religion: Hindu
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8 Answers
Who can help forming the trust? Attorneys or CPA's? If it a simple procedure to form a trust and move assets into a trust. Can I move multiple assets into the same trust? Can US citizens create a trust and move their Indian properties into trust? and link this India based trust to a parent trust in USA? Please advise.
Asked 3 years ago
You can execute registered gift deed in your wife favour for your 50 per cent share in property
Stamp duty is state subject and varies from state to state
3) in alternative you can set up a private trust wherein your wife and children can be beneficiaries
4)
you have to appoint trustees to administer the trust.
The trust deed or will should specify the following features:
- The intention for creating the trust
- The objective of the trust
- Beneficiary or beneficiaries
- The trust property, which is to be transferred by the settlor to the trust during the creation of trust unless the trust is being stated under a Will, in which event, the asset will get transferred to the trust at the time of your death.
Engage a lawyer for drafting trust deed
multiple properties can be transferred to trust
A gift deed can be registered in favour of the wife
The gift deed can be signed by both the donor and donee in the USA before the local public notary followed by endorsement by the Indian consulate/embassy
Also obtain a certificate of Apostille for the notary done which is an online procedure
The gift deed has to be signed before 2 witnesses
Alongwith the gift deee also sign a special power of attorney in favour of a trusted person in India who would comply with the registration formalities before the jurisdictional sub registrar and get the gift deed duly registered
The SPOA can be a joint one made by both husband and wife in favour of a single grantor
If you transfer the properties to a trust and make your wife and kids as its trustees then who will be the beneficiaries of the trust?
I suppose what you want is to make your wife and kids as beneficiaries and not as trustees ? Right?
The trust can be formed under the provisions of the Indian Trust Act
A trust deed has to be registered and then filed in the office of the concerned Charity Commissioner
The trust so formed also has to comply with the local state law depending on which Indian state your property is situated
Logistically it would not be proper to form a common trust for your US and Indian properties as both would be governed by different compliances and laws
- Since you both are owner of the property , then you can transfer you half share in the name of your wife after executing a registered gift deed for making her single owner of the property.
- Further , as you are going to gift the property to your wife , then the stamp duty will be minimum and can claim tax exemption as well.
- Further if you want to benefit all the family members then can also set up a private trust .
Dear Sir,
Since you and your wife are both joint owners of the property, you can simply execute a gift deed. In case you want your wife and children to hold the property as beneficiaries then you can form a trust under the Indian Trust Act. A trust usually involves three parties: The grantor or trustor who creates the trust, the trustee who manages the assets held in trust, and the beneficiary or beneficiaries named in the will. An attorney can help you form the trust.
Thank You.
If you like to transfer your share in the property to your wife name, you can do it by executing a registered gift deed.
The applicable stamp duty and the registration charges to be borne by you.
Creation of trust is different to that of the proposed transfer.
Since your wife is also a joint owner in the property, you can create a trust only insofar as your share in the property is concerned which will create complications in the future hence better you may not go for this option.
Trusts in India may be required to comply with the rules of the Foreign Account Tax Compliance Act (FATCA) to report all details to the Internal Revenue Services of US
There are two basic things required to be able to form a Trust—power of disposition over property and competence to contract.
Some specific requirements have to be fulfilled for setting up the Trust, which would depend on the peculiarity and complexity of each Trust. You would require legal assistance in the matter. Trusts in India may be required to comply with the rules of the Foreign Account Tax Compliance Act (FATCA) to report all details to the Internal Revenue Services of US. It would be ideal to seek consultation of a lawyer practicing in US laws.