HOW TO GIFT PROPERTY IN TRINIDAD AND TOBAGO

CONTACT US HERE

Share This:

Gifting property in Trinidad and Tobago is a significant legal decision that requires careful consideration and adherence to the laws of T&T. Whether you're considering transferring property to a family member, friend, or entity, understanding the legal procedures and requirements is essential to ensure a smooth and legally binding transaction. In this comprehensive guide, we'll walk you through the key steps and considerations involved in gifting property in Trinidad and Tobago.

In the context of property transfers by gift, "the Donor" refers to the individual or individuals giving up or relinquishing the property, while "the Donee" refers to the recipient or recipients of the property.

Understanding the Legal Requirements
​

1. Capacity and Consent: The Donor (the person giving the property) must be of sound mind and legal age to make decisions regarding the transfer of property. Additionally, the Donor must consent willingly to the gift without any undue influence or coercion. The Donor must also have title to the property that he or she intends to transfer; this means that he/she must actually have an interest in the property that can be transferred to another.
   
   
2. Legal Formalities: In Trinidad and Tobago, a gift of property must be made in writing and signed by the Donor. The document must clearly identify the property being gifted and state the intention to transfer ownership to the recipient. The document would be a Deed of Gift or a Memorandum of Gift depending on whether the property in question is held under the common law or under the Real Property Act.
   
   No Deed of Gift will be effective to pass any interest until it is registered. All Deeds of Gift (including Memorandums of Gift) must be registered within twelve (12) months from the date of its execution (​section 18 of the Registration of Deeds Act Chap 19:06). Such documents can be registered after the twelve month period but only upon payment to the Registrar General of a sum equal to five times the amount of the fees which would have been chargeable for registration if the Deed had been registered within the said period, together with such further penalty not exceeding the sum of $2000TT.
   
   
3. Stamp Duty: Gifts of property are subject to stamp duty, which is a tax imposed on legal documents. It's important to consult with a legal expert to determine the applicable stamp duty rates and ensure compliance with tax laws in Trinidad and Tobago.

Steps to Gifting Property

1. Consultation with a Legal Professional: Before proceeding with the gift, one should seek guidance from a qualified attorney experienced in property law in Trinidad and Tobago. They can provide invaluable advice on the legal implications, tax considerations, and documentation required for the transfer.

2. Valuation of the Property: It's essential to determine the fair market value of the property being gifted by doing a property valuation. A property valuation is an opinion or assessment of the property's value, based on the location, condition, size and other factors. A valuation must be carried out by a professional valuator and involves the valuator visiting the location and taking notes and photographs of the property.
​
A valuation is important because:

• The value of the land being gifted determines the legal fees as well as the stamp duties to be paid.
• Deeds of Gift always require a valuation to be done in writing to be submitted to the Board of Inland Revenue.​

3. Drafting of the Deed: The Deed of Gift is a legal document that formally transfers ownership of the property from the Donor to the Donee. The deed should accurately describe the property, state the Donor's intention to gift it, and outline any conditions or restrictions attached to the gift.

4. Execution: Once the gift deed is drafted, it must be signed by the Donor and attested by witnesses.

5. Payment of Stamp Duty: As mentioned earlier, the deed of gift is subject to stamp duty. Stamp duty is a tax paid to the State (by paying to the Board of Inland Revenue) and the amount to be paid depends on the value of the property. When the Deed of Gift is completed, that is, it is drafted, signed and sworn, it is presented by your attorney to the Inland Revenue Division at the Ministry of Finance for evaluation. Following assessment and determination of the requisite stamp duties, the deed is presented for stamping along with the applicable fees.

It should be noted that the State allows for exemptions from stamp duties in the following circumstances:

As of January 1st, 2021, if you are buying house and land (a residential property including a dwelling house) for the first time, the State exempts you from paying stamp duty if your property value is equal to or less than $2 million TT dollars. If the value of the residential property exceeds $2 million TTD, the following rates shall be applied:

• 5% on every dollar of the first $250,000TT in excess
• 7.5% on every dollar after that

If you are not a first time home-owner and you are buying a house and land (a residential property including a dwelling house), the State exempts you from paying stamp duty if your property value is equal to or less than $850,000 TT dollars. If the value of the residential property exceeds $850,000 TTD, the following rates shall be applied:

• 3% on every dollar of the first $400,000TT in excess
• 5% on every dollar of the next $500,000TT in excess
• 7.5% on every dollar after that

There are also exemptions for residential land up to a value $450,000TTD in value. If the value of the residential land exceeds $450,000TTD, the following rates shall be applied:

• 2% on every dollar of the first $200,000TT in excess
• 5% on every dollar of the next $200,000TT in excess
• 7% on every dollar after that

Your attorney-at-law will advise you on the stamp duties to be paid for your documents.

6. Registration: After the deed has been signed and stamp duties have been paid, the deed must be registered at the Land Registry in the Registrar General's Department at the Ministry of the Attorney General and Legal Affairs.

Conclusion

Gifting property in Trinidad and Tobago entails a series of legal procedures and considerations that must be carefully navigated to ensure adherence to the law and safeguard the interests of all involved parties. It also serves as a strategic option for planning the transfer of property to loved ones despite the inevitability of one's passing. Rather than allowing the property to become part of one's estate upon death, which would necessitate family members to undergo the arduous probate process to access the property, a Deed of Gift offers an alternative route.

In essence, a Deed of Gift circumvents the complexities of posthumous legal proceedings, streamlining the ownership transfer process and sparing beneficiaries from the lengthy paperwork and court involvement typically associated with probate. This expedites the transfer of ownership, bypassing delays and intricacies inherent in probate proceedings.

By engaging with legal professionals, comprehending the legal requisites, and adhering to the prescribed procedures, individuals can facilitate a smooth and legally binding transfer of property. Whether the motive behind gifting property is personal or driven by estate planning objectives, thorough preparation and compliance with legal formalities are imperative to mitigate risks and ensure a seamless transaction.

Important Notice: This post does not constitute legal advice. Always consult with an attorney on any legal problem or issue.

This website is managed by AURORA Chambers; a legal practice in Trinidad and Tobago.

CLICK HERE to receive updates straight to your inbox by subscribing to our newsletter.