Equity FundsMutual Funds

Death Certificate help in Transfer of Equity Shares & Mutual Funds to Nominee

Mutual funds cannot be transferred from one person to another but the process of transmission defers a bit.

Death certificate to transfer Equity shares & funds to nominee

Death certificate refer to a document issued either by a medical practitioner certifying the deceased state of a person or a document issued by such a person such as a registrar of vital statistics that declares the date, location and cause of the death of a person.

READ: Equity mutual funds investments – Indians investing 1.5 Lakh crore per annum

Equity shares are the main source of finance of a firm issued to the general public and a mutual fund is a professionally managed investment fund that pools money from many investors to purchase securities. The investors can either be retail or institutional. Both equity shares and mutual funds are transferable and this can be done with or without the consideration of other person(s).

Equity shares transfer to a receiver happens when the unit holder is still alive while equity shares transmission happens when the shareholder is deceased and the shares are being transferred to nominees. The same can be done in the case of mutual funds transmission but mutual funds cannot be transferred from one person to another but the process of transmission defers a bit.

  1. Equity shares transmission: the personal representative of the shareholder shall obtain probate or Letters of Administration from the jurisdiction in which the deceased was domiciled to deal with his shares in the firm. Application will then be submitted to the company notifying the company of his or her intention to either be a member of the company or to transfer the shares to another person. The application to be submitted will be accompanied by a list of documents which includes;

(a).  A copy of the probate or Letters of Administration.

(b). Original shares certificate of the deceased share holder.

(c).  A copy of the death certificate of the deceased shareholder.

Upon completion of this process, the personal representative of the deceased will be given a new shares certificate.

2.  Mutual funds transmission: mutual funds cannot be transferred directly from one holder to another as this is only possible hypothetically but not practically. Since mutual funds can be liquidated easily, the money is first transferred to the receiver’s account,then the money can be used to invest in the person’s name. In case of death of the unit holder and there’s a nominee staking claim to the investment (in case there’s no joint holder), the fund house will require a set of documents according to SEBI’s circular, the list includes;

(a). Death certificate of the deceased.

(b). Letter from co-holder or nominee.

(c). Know Your Client (KYC) of the nominee.

(d). Indemnity bond if the amount exceeds Rs. 1 lakh.

(e). Mandate to register the nominee’s bank account.

Nominees for either equity shares or mutual fund will need the death certificate of the deceased before they can stake claim to shares or funds. However, there are cases where the deceased neither has a nominee or a will, the certified copy of the death certificate can be used to stake claim to the shares or funds.

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Ankita Awasthi

Ankita Awasthi is stock market expert and have experience more than 7 years. Also she is a MBA in Finance and worked in investment banking, Bitcoin and cryptocurrency.

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