1 month ago
NRIs Guide to Inheriting Shares, Mutual Funds, Bonds
When a family member passes away, NRIs may inherit financial assets like shares, mutual funds, and bonds.
The process to claim these assets can be complex and delayed due to missing documents or outdated nominations.
Experts recommend identifying all investments, checking nominations, and obtaining certified copies of the death certificate.
NRIs should also consider appointing a representative in India through a Power of Attorney.
The transmission process can take varying amounts of time depending on the asset type and whether a nominee has been registered.
SEBI's new transmission framework aims to simplify the process, but delays often occur due to overseas documentation requirements.
Common issues include mismatched names, missing KYC records, and unattested foreign documents.
While a Will can help, maintaining updated nominations is equally important for faster transmission.
Identify all financial assets and check nominations before approaching any registrar or mutual fund.
Obtain multiple certified copies of the death certificate and have them notarised.
Appoint a trusted representative in India through a notarised and apostilled Power of Attorney.
Transmission timelines vary depending on the asset type and nomination status.
Common documentation issues include mismatched names, missing KYC records, and unattested foreign documents.
- Who
- Non-Resident Indians (NRIs) inheriting financial assets in India.
- What
- The process and steps to claim inherited shares, mutual funds, and bonds.
- Where
- In India, involving financial institutions and regulatory bodies like SEBI.
- When
- After the death of a family member who has left behind financial assets.
- Why
- To simplify and standardise the transmission process for NRIs inheriting financial assets.
Importance of Nominations
Importance of Wills
Transmission Process
Importance of Nominations
Nominations simplify the transmission process, making it faster and requiring fewer documents.
Importance of Wills
A Will provides clarity and reduces disputes among legal heirs, though it may require additional documentation for higher-value estates.
Documentation Requirements
Importance of Nominations
With a nominee, the transmission process is generally simpler and quicker, often taking 7-15 days for mutual funds and 15-30 days for listed shares.
Importance of Wills
A Will can help in cases where there is no nominee, but the process can be longer, taking up to six months or more, especially in complex cases.
Regulatory Framework
Importance of Nominations
SEBI's new transmission framework aims to simplify and standardise the process, with transmission requests expected to be processed within 21 calendar days.
Importance of Wills
While SEBI's framework has eased several procedural requirements, some institutions may still seek additional documentation for higher-value estates even with a registered Will.
Key facts
- Consolidated Account Statement (CAS)
- Helps locate most investments.
- Death Certificate
- Required for transmission, should be notarised.
- Power of Attorney (PoA)
- Helps complete formalities locally for NRIs.
- Transmission Timelines
- Vary depending on asset type and nomination status.
- SEBI's Transmission Framework
- Aims to simplify and standardise the process, with a 21-day processing window.
- Common Documentation Issues
- Incomplete or inconsistent documentation, mismatched names, missing KYC records, unattested foreign documents, signature mismatches, missing NOCs, lost physical share certificates.
- Apostille Requirements
- Foreign documents need notarisation and apostille before acceptance in India.
- Probate Requirement
- SEBI has removed the mandatory requirement of probate for transmission.
Quotes
Shraddha Nileshwar
Head of Will & Estate Planning at 1 Finance
“"The real delay usually comes from overseas documentation, including apostille requirements, embassy attestation and courier timelines, rather than the regulator's processing window."”
livemint.com
“"Before approaching any registrar or mutual fund, the NRI heir should collect the death certificate and verify whether a nomination exists for each folio or demat account."”
livemint.com
Sources
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