InvestorQ : Should I have a nominee for the DP account?
Nishant Chandani made post

Should I have a nominee for the DP account?

Answer
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Archita Jajjoo answered.
2 years ago


Nomination can be made only by individuals holding beneficial accounts either singly or jointly. Non-individuals including society, trust, body corporate, Karta of HUF, holder of POA cannot nominate. This distinction is quite important. Remember when you have a joint account and even if you nominate a person the benefits will first go to the other joint holder in the event of the death of one of them. Only if both the joint holders die there will be a movement of shares to the Nominee. Who can be a nominee? Only an individual can be a nominee. A nominee shall not be a society, trust, body corporate, partnership firm, Karta of HUF or a POA holder.
Actually, the nomination is quite important and it is always better than you do it. In fact, most brokers will ask you to nominate a nominee at the time of account opening itself for your own convenience. Why is it important to nominate? The nomination is helpful in smooth transmission of shares upon the death of the BO/s. The nomination once made can be changed at a later date as desired by the BO/s.