downloadDownload The App

How to claim mutual fund investments of the deceased?

As per the law, either the joint holder in the portfolio or nominee or legal heir mentioned in the will can claim the mutual fund proceeds through a process called 'transmission'

When it comes to balanced hybrid funds, the investors who are conservative in their approach and wants to take advantage of the return on equities without the increased risk can go for these funds.

We constantly try to save and invest our earnings in multiple ways to ensure a comfortable future for our family and loved ones. Many people have a full proof investment plans up to their retirement. But death, as we know it, is not only inevitable but unpredictable too. So, what happens to savings when the person dies? How can their loved ones claim it?

In a recent episode of Money9 Helpline, a viewer expressed concern about getting access to his deceased father’s mutual fund investments.

“I lost my father due to Covid-19. I have received the insurance claim. He used to invest in mutual funds and the stock market, which I have no idea about what should I do?” Maulik Saini from Gujarat asked.

As per the law, either the joint holder in the portfolio or nominee or legal heir mentioned in the will can claim the mutual fund proceeds through a process called ‘transmission’.

Role of AMC

As per the law, either the joint holder in the portfolio or nominee or legal heir mentioned in the Will can claim the mutual fund proceeds through a process called ‘transmission’. Kshitiz Mahajan who is the co-founder of Complete Circle Consultants told Money9, “The process to claim mutual funds and shares is much easier than banks. You can access all the data set of investment through your father’s PAN card. You can visit any mutual fund house irrespective of the fact if your father had invested through it.”

Almost all mutual fund companies broadly share a common procedure for transmission of units. The format or list of documents might vary here and there but overall process is similar at most places.

MF claim process The nominee or joint holder will have to submit an application to the MF house along with the following documents for transmission.

> Request application for transmission of MF units in the AMC-specified format
> Original or attested photocopy of the death certificate of the deceased unit holder
> KYC confirmation of nominee or claimants or surviving unit holders
> Cancelled cheque with account number and holder’s name printed on the cheque / bank account statement
> FATCA self-certification
Apart from this, “You need to submit your father’s details, death certificate, and relationship proof with your father to the MF house. Through this, you will be able to access all the information about his investments,” Mahajan noted.
In case the nominee or legal heir is a minor, all stated documents of the guardian will be required. Moreover, in case of multiple heirs, an indemnity bond signed by all legal heirs confirming the claimant should also be produced. If this claim amount is above Rs 2 lakh, the applicant must also attach a succession certificate by a competent court.
Ideally, it takes up to 15 days after submission of request letter and relevant documents for transmission process to be executed.
 Important points to keep in mind An issue may arise if nominee’s name in the identity documents does not match the one in the AMC’s record. It could be because of a spelling error or elimination of the middle name in either of the two records. Make sure to keep such things in check while filing for nomination.
In case of transmission of MF units, the nominee is not liable to pay any tax. It is only at the time of unit redemption that tax liability comes to the surface. The date of transmission has no significance on the exit load as the original date of fund purchase will be applicable here.
Published: June 6, 2021, 10:53 IST

Download Money9 App for the latest updates on Personal Finance.

Related

Latest

close