Demat account nomination: How to update nominee details?

According to a circular released by SEBI in July 2021, demat account holders need to provide nominations.

Who is a Nominee?

You can nominate family members such as parents, spouse, or children, or other individuals. If you choose to nominate a minor, you must also provide the details of their guardian. The authorised person will be able to own, manage, and benefit from the account.

You can appoint up to three nominees to your demat account, assigning a specific percentage of the account to each nominee. For instance, if you nominate three people, you could allocate 35 percent to one nominee, 40 percent to another, and 25 percent to the third.

How to Add/Update Nominee Details?

Adding/updating a nominee to your demat account online is a simple process. Initially, you can add nominee details in the account opening form submitted to your broker. To add, modify, or remove nominees later, submit an Annexure 1A form to your broker. Follow these steps to add/update a nominee online:

• Log in to your demat account.
• Access your personal account details by clicking on the account icon.
• Enter/update the nominee’s information, including their name, date of birth, relationship, and allocation percentage.
• If there are multiple nominees, specify the percentage allocation for each.
• Once all required details are entered, click ‘Submit’ to finalise the changes.

Things to Keep in Mind While Appointing a Nominee

When appointing a nominee for a demat account, keep the following key points in mind: Only individuals can be appointed as nominees; non-individuals like corporate institutions cannot be nominated. The form requires the nominee’s name and address, along with the account holder’s signature. Submitting nominee ID proof is optional. A witness’s name and signature are needed if the account holder uses a thumb impression. If the nominee is a minor, the guardian’s name and address, as well as the minor’s date of birth, are required. The nominee, guardian, and account holder cannot be the same person. To remove an existing nominee or choose the “Opt-out” option, the account holder must complete the same form, stating their intention not to make a nomination.

The online nomination facility allows for efficient transfer of your investments to an appointed individual, ensuring your family’s financial security in the event of an unforeseen circumstance. New investors can add a nominee when opening a demat account, while existing account holders can edit account details to add nominees.

FAQs

Who can be nominated for a demat account?

Nominees can include parents, spouse, children, siblings, or other relatives. Minors can also be nominated, with details of their guardian provided. The nominee, guardian, and account holder cannot be the same person.

Can I nominate more than one person?

Yes, you can add up to three nominees in a demat account. Each nominee can be assigned a specific percentage of the account holdings.

Can non-individuals be nominated?

No, only individuals can be nominated for a demat account; corporate institutions or other non-individual entities cannot be nominees.

What happens if I don’t add a nominee?

If you don’t add a nominee by the deadline specified, your demat account and trading account may be deactivated until you fulfill the nomination requirement.

How do I change or delete a nominee in my demat account?

You can change or delete a nominee by updating your account details online or submitting the necessary form to your broker. To delete a nominee, you need to provide a declaration stating you do not wish to make a nomination.

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Published: 10 May 2024, 03:44 PM IST