How to Transfer Shares from One Demat Account to Another
The process to transfer shares from one Demat Account to another is simple and can be done both online and offline. You can use the Demat account to move shares between accounts. Since the ownership of the shares are not changed, you will not have to worry about any transactions. Therefore, no tax is levied for the transfer of shares.
Different Methods to Transfer Shares from One Demat Account to Another
Online
- First, you will need to complete the registration process on the official website of NSDL or CDSL.
- Once the relevant form has been filled and submitted, take a printout and provide it to the broker.
- The broker will submit the form to the relevant central depository to complete the verification process.
- Once the verification process has been completed, the account will be activated and the login details will be sent via email. You must login to the account to complete the transfer process.
Offline
- The ISIN number, Target Client ID, and Mode Selection must be entered in the Delivery Information Slip (DIS). The DIS will be provided by the broker.
- Sign the DIS and submit the same to the brokerage firm (existing). An acknowledgement slip will be provided.
Once the transfer process has been initiated, the shares will be displayed in the new account within 5 days.
The beneficial ownership does not change in the case of transfer of shares. Therefore, no capital gains will need to be paid. However, the broker may levy a fee to process the transfer request. No charges are levied for closing the old account.
Reasons for Transferring Shares
The main reasons for transferring shares from one Demat account to another account are mentioned below:
- You can transfer the shares in case better services are provided. Some platforms offer better security as well.
- The brokerage fees may be reduced in case you transfer the shares.
- You can consolidate all your holdings into one account.
- Shares can be categorised for better planning.
FAQs
- Can I transfer my shares to another individual?
Yes, you can transfer your shares to another individual. However, a valid reason must be provided for transferring shares.
- Will capital gains be applicable in case I transfer shares to another individual?
Yes, capital gains will be applicable in case you transfer shares to another individual.
- Do I have to pay tax to transfer my share to another Demat Account?
No, you do not have to pay tax to transfer the shares to another Demat Account.
- Can the broker charge a fee to transfer the shares to another Demat Account?
Yes, the broker can charge a fee to transfer the shares to another Demat Account.
- Can I transfer shares from one depository to another?
Yes, you can transfer shares from one depository to another.
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