One of the most common reasons for prolonging investing is documentation for demat account . The only way to combat this problem is to face it with a plan!
1. Identity proof
PAN card – This is mandatory for every investor.
Unique Identification Number (UIN) – This could either be Aadhaar card or Passport or Election card.
Proof of identity issued by government bodies, PSUs or public financial companies, universities or professional bodies – ICAI, ICSI, etc.
2. Address Proof
Either of these documents can be used as a proof of permanent address:
Aadhar card
Ration card with address
Certificate of address issued from government bodies
Water bill in your name
Telephone bill in your name
Electricity bill in your name
Bank statement
3. Bank Proof
Any of the following documents qualify as bank proof:
Personalized cancelled cheque
Bank account statements for the past six months
Passbook
4. Income Proof
Any of the following documents qualify as income proof:
Income Tax Returns (ITR) copy
A copy of audited annual accounts audited by a qualified CA
Salary slip
Personalized cancelled cheque
Bank account statements for the past six months
Passbook
Documents substantiating ownership of assets
5. Passport -size photographs
Once you have gathered these documents, the next step is to fill the Demat account opening form. Along with the Demat form, you are also required to fill the nomination and power of attorney agreements. It is also important to know that a minor cannot be appointed as a joint holder but can be a nominee to a demat account.
The Power of Attorney (POA) agreement has your demat account and bank details. Duly note that the POA must be given out in the name of broker and not in any other name. The agreement is given to the broker for transferring securities, settling trade and transferring funds to and from your account.
6. Paperless demat account documentation
FAQs – Documents Required for Demat Account
What is a demat account?
A demat account holds all your securities in an electronic form. It helps mitigate the risk of misplacement and theft.
Why does one need to open a demat account?
Demat account with a registered broker is mandatory for buying and selling shares in the stock market.
How many people can jointly hold a demat account?
A demat account can be jointly held by three holders. An individual can appoint two joint holders. However, the demat account will be in the name of the primary holder.
Why is nomination helpful?
Nomination helps to avoid conflicts between family members in case of the death of the primary holder. Nomination is allowed for accounts with joint holders. In case of the death of joint holders the securities will be transferred to nominee.
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