If you want to invest in the Indian equity market, you must first open a trading account. Some people, however, prefer to have a joint demat account. Let’s take a closer look at it in this article so that we can truly understand it.
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Joint Demat Account
A joint Demat account with a maximum of three account holders, including the principal account holder, can be opened. The digital method cannot be used to open a joint Demat account. You must print, complete, and send the Demat application form to brokers headquarters.
The Demat form should be filled out using the correspondence address of the first holder. The first holder will get all communication regarding the joint Demat account. Along with the documents listed in this page, the first holder’s bank proof must be provided.
To comply with the KYC criteria, all joint holders must submit personal KYC forms with passport-sized pictures attached and signed over, as well as individual address documents and PAN records.
Joint Demat Account Taxation
A trading account allows you to purchase and sell market securities as well as execute all of your stock market activities. A demat account, on the other hand, allows you to keep your assets in digital form. As a result, you’ll need to open a demat account and a trading account.
Investors cannot open a trading account together. Just one name can be used to open a trading account. This is due to the fact that every trading account is linked to the investor’s personal PAN number.
Individual investors, on the other hand, can set up a joint demat account. As the initial account holder’s trading account is linked to it, the tax liabilities will remain with him/her.
How to Open Joint Demat Account?
If you are wondering how to open a Joint demat account, here is the process approved by SEBI:
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Step 1
To open a Joint demat account, you must contact one of the DPs (depository participants). You can open a demat account via your bank or via stock brokerage firms.
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Step 2
The application form, as well as other required documents such as an ECS mandate form and a KYC document, must be downloaded from the relevant website. Take a photocopy of your PAN card, address proof, and identification verification documents with you while visiting the broker’s office.
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Step 3
When you fill out the form, sign it in all of the required and indicated sections. Then handover all of the forms and the broker will proceed to the application for your demat account.
You must ensure that the type of demat account is selected according to the requirements while filling out the form (either joint or single). Make sure to be specific about the nominee’s details.
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Step 4
You will be given a number for your demat account as well as the credentials for online login once your application has been verified successfully. If you have any questions or have any problems during the process, call the client service number for assistance.
Documents Required for Opening a Joint Demat Account
- PAN Cards are required for all account holders (excluding those who have been discharged from acquiring their PAN (as specified in Section D)).
- All account holders will receive Aadhaar cards.
- For all account holders, a passport-sized photograph is required.
- Personalized cheques are issued to all account holders and then canceled (However, a bank statement from the previous three months will be sufficient.)
- After all of the demat account’s document standards have been met and properly filed, the account will be terminated within 5 working days.
Note
In the case of a shared demat account, the ownership is to be transferred in the name of the surviving account holders in the event of the death of any of the account holders. If everyone passes away, the nominee will receive all of the benefits.
Need of Joint Demat Account
In the following situations, you can open a Joint Demat Account:
- When physical shares are held in a joint Demat account.
- When you have a joint account with another broker and want to shut it and transfer your shares to another broker.
- When you receive money from your parents or have certain funds that are pooled by two or three people.
Conclusion
With the above information in mind, you can make an informed decision about opening a joint Demat account safely and effectively.
This is all from our side regarding Joint Demat Account. Let us know your views about joint demat account india in the comment section.
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Demat Account Holding Statement
Frequently Asked Questions About Open Joint Demat Account Online?
Can I open a joint demat account?
Yes, a demat account can be held by a single person or by a set of people. A trading account, on the other hand, can only be opened by a single person. In the scenario of a joint account, the tax liability will fall on the first holder of the demat account.
Can I add joint holder in demat account?
Yes, one, two, or three people can have Demat accounts at the same time. If you want to open a demat account for more than one individual, you must do so at the time of account opening. You cannot add an additional person to an account that has already been created.
Can I add my wife to my demat account?
Yes. She is allowed to alter her name after marriage, but she will need some very basic papers to do so. You must provide documentary proof of why you want the name on your demat account updated. These can be used as legal proof to back up your request for a name change.
How does joint demat account work?
Joint Account in case of demat account can be held by a maximum of 3 people. However, Tax liabilities will remain on the principal account holder as his trading account will be connected to it.
Can I open joint account with Zerodha?
At Zerodha, you can set up a joint account. However, because online account opening is not available for joint accounts, you must do it offline.
