Taxation of Gifts in Pakistan Tax Year 2025-How much tax do I have to pay on gifts in Pakistan

I am the father, i want to gift a plot to my son. What steps should i take so that he is not taxed ?
If you want to gift a plot to your son in Pakistan and ensure he is not taxed, here are the steps you should follow to make the transfer tax-free and compliant with the law:
1. *Draft a Gift Deed*
- A *gift deed* is a legal document that officially transfers ownership of the property from you (the donor) to your son (the donee). In this case, as the father, you are transferring the property without any exchange of money or consideration.
- The deed should clearly mention:
- The relationship between you and your son.
- The details of the property (location, size, etc.).
- A statement declaring that the transfer is a **gift**, made out of love and affection, and without any exchange of money.
- Both your signatures and the signature of two witnesses.
2. *Stamp Duty and Registration*
- Even though gifts to close relatives are tax-exempt, the gift deed must be registered to complete the legal transfer.
- Visit the *sub-registrar's office* where the property is located.
- Pay the *stamp duty* and **registration fee**. The stamp duty on gifts to close relatives is generally lower than normal property transfers and may vary based on the provincial laws (for instance, in Punjab, it's around 3% to 5%).
3. *Mutation of the Property*
- Once the gift deed is registered, initiate the process of *mutation* at the relevant land revenue office (Tehsil or Development Authority).
- Mutation updates the land records to reflect the new ownership of the property in your son's name.
4. *Record Keeping*
- Ensure all documents related to the gift deed, registration, and mutation are securely stored. These will be crucial if your son ever needs to prove ownership or if any legal issues arise in the future.
5. *Declaration in Tax Returns*
- Although gifts to relatives are tax-exempt, both you and your son should still **declare the gift in your annual tax returns**.
- You, as the donor, should mention the gift in the relevant section of your **Wealth Statement**.
- Your son, as the recipient, should declare the property under *Assets* in his Wealth Statement but will not be taxed on it as it falls under *exempt gifts* (Section 79 of the Income Tax Ordinance).
6. *Stay on Active Taxpayer List (ATL)*
- To avoid any withholding taxes or other complications, both you and your son should ensure that your names appear on the **Active Taxpayer List (ATL)**. This ensures smoother transactions and avoids penalties.
By following these steps, the gift of the plot should be tax-free for your son under Pakistani law.
Let me know if you need further clarification or assistance!
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[@mirzaali9374]

Sir deny wala gift ntn holder ho and leny wala ntn holder na ho to phir Kiya ho ga chahy gift deed bi ban jaye

[@TaxDosti]

Yes gift deed is necessary