A nominee to a demat account is a person who is designated by the account holder to receive the securities and shares held in the demat account in case of the account holder’s death. The nominee can be a family member or any other person chosen by the account holder. Adding a nominee to a demat account is an important step in ensuring that the investments held in the account are transferred to the designated person in case of the account holder’s demise, thus avoiding legal hassles and ensuring a smooth transfer of assets.
Once you open a demat account you should add a nominee to ensure your securities are never lost. To add a nominee to your demat account, you need to follow the below-mentioned steps:
Step 1 – Obtain the Nomination Form
The first step is to obtain a nomination form, which can be obtained from the depository participant (DP) with whom you have opened your demat account. You can also download the form from the website of the depository or the DP. Ensure that you download the correct form that is applicable to your depository and the type of account you hold.
Step 2 – Fill in the Nomination Form
Once you have obtained the nomination form, you need to fill in the details correctly. Some of the important details that you need to fill in include your name, address, date of birth, and other such details. You also need to fill in the details of the nominee, including their name, address, and date of birth. You need to provide the nominee’s relationship with you, which can be a spouse, parent, sibling, or any other person. If you are adding more than one nominee, you need to specify the percentage of share that each nominee will receive in case of your death. You also need to provide your demat account details, including your demat account number, DP ID, and the name of the DP.
Step 3 – Get the Nomination Form Attested
After filling in the nomination form, you need to get it attested. The attestation can be done by a notary public or a gazetted officer. You need to provide a self-attested copy of your PAN card and a passport-sized photograph. You also need to provide a self-attested copy of the PAN card and a passport-sized photograph of the nominee. In case the nominee is a minor, the guardian of the nominee needs to provide their PAN card and photograph.
Step 4 – Submit the Nomination Form to the DP
Once you have filled in the nomination form and got it attested, you need to submit it to the DP with whom you have opened your demat account. You can submit the form either in person or by mail. In case you are submitting the form by mail, you need to ensure that you send it by registered post or courier. You need to keep a copy of the nomination form for your records.
Step 5 – Acknowledgment
After submitting the nomination form, the DP will verify the details and process your request. Once the nomination is added to your demat account, you will receive an acknowledgment from the DP. The acknowledgment will contain details such as the date of nomination, the name of the nominee, and their relationship with you.
It is important to note that adding a nominee to your demat account is an important step in ensuring that your investments are secure. In case of your death, the nominee will receive the shares and securities that are held in your demat account. It is advisable to review the nomination details periodically and make changes if required.
You can make changes to your nominees to your demat account through the demat account app. Here are the benefits of a nominee to your demat account.
- Easy transfer of assets: Adding a nominee to your demat account ensures that your shares and securities are transferred to the designated person in a hassle-free manner, avoiding legal complications and delays.
- Avoidance of legal disputes: In case of the account holder’s death, having a nominee ensures that the assets are transferred to the designated person, thus avoiding any legal disputes between the legal heirs.
- Protection of interests: Having a nominee ensures that your interests are protected, and your assets are transferred to the right person in case of your demise.
- Saves time and money: Having a nominee to your demat account saves time and money that would otherwise be spent on legal proceedings in case of the account holder’s death.
- Flexibility: The account holder has the flexibility to change the nominee anytime, ensuring that the right person is designated to receive the assets.
In conclusion, adding a nominee to your demat account is an important step in securing your investments and ensuring that they are transferred to the right person in case of your demise. It is advisable to review the nomination details periodically and make changes if required.
