Gift or Donation Agreement: What is the Difference and How to Arrange Assistance During the War

The Dnipro Interregional Department of the Ministry of Justice of Ukraine explained the difference between a gift agreement and a donation agreement.

The Civil Code of Ukraine provides for two similar but fundamentally different instruments — a gift agreement and a donation agreement.

Gift Agreement: Complete Transfer of Ownership

According to Article 717 of the Civil Code of Ukraine, one party gratuitously transfers or undertakes to transfer in the future property or property rights to the ownership of the other party.

The subject of a gift agreement can be any movable items, including money and securities, real estate, as well as property rights.

The main condition: the absence of any reciprocal obligations. The donor cannot impose requirements regarding the further use of the transferred property.

Consequences: after receiving the gift, the person or organization becomes its full owner and uses the property at their own discretion. The donor can no longer control the further fate of the property.

Donation Agreement: Assistance with a Specific Purpose

A donation (Article 729 of the Civil Code of Ukraine) is a special type of gift agreement where the predetermined purpose of using the property is of key importance.

The subject of a donation agreement can be movable or immovable property, funds, or securities. The agreement must specify the exact purpose of using the donation. At the same time, property rights cannot be the subject of a donation agreement.

The main condition: the agreement clearly defines the targeted purpose of the property. For example, for purchasing medical equipment for a hospital or acquiring specialized transport for a military unit.

Consequences: according to Article 730 of the Civil Code of Ukraine, the donor has the right to control the use of the donation. If the property is used not according to the intended purpose, the donor may demand termination of the agreement in court.

Form of the Agreement: Oral or Written?

Civil legislation establishes clear requirements for the form of gift and donation agreements.

Oral form is allowed for items of personal use and household purposes. Small everyday donations can also be made in the same manner.

Written form is mandatory for:

- movable property of special value;

- property to be transferred in the future.

Written form with notarial certification is mandatory for agreements concerning:

- real estate;

- currency valuables between individuals exceeding fifty times the non-taxable minimum income of citizens.

Legal Nuance

In practice, during support of charitable collections, humanitarian initiatives, or volunteer projects, the mechanism of a public offer or adhesion contract is often used. In such cases, the written form is effectively confirmed by the very fact of transferring property or funds for specified purposes.

Moment of Contract Conclusion

A donation agreement is considered concluded from the moment the donation is accepted.

A gift agreement may be considered concluded either from the moment the gift is transferred or from the moment the parties reach an agreement if the contract provides for the donor's obligation to transfer the property in the future.

Who and How to Arrange?

The choice of procedure depends on who receives the assistance.

If the recipient is a military unit or a charitable organization, contacting a notary is usually not required. It is sufficient to conclude a donation agreement in simple written form and draw up an acceptance-transfer act of the property. This document serves as the basis for registering the property.

If the recipient is an individual and the subject of the agreement is real estate or other property for which the law requires notarial certification, the agreement must be executed by a notary.

Summary

If it is important for you that funds or property are used for a specific purpose and you have the right to control their use, it is advisable to conclude a donation agreement.

If property or property rights are transferred without any conditions regarding their further use, the optimal option is a gift agreement.

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