Return maintenance charge if demat closed before expiry: Sebi (2024)

FAQs

Will I get refund if I close my demat account? ›

Will I get a refund if I close my Demat account? You will receive a refund from the DP when you close your Demat account or shift it from one DP to another.

If there are no holdings and still you have an inactive account, then you are not allowed to open another account. Your brokers (DP or depository participants) hold your dormant account until you deactivate it. They will bombard you with the statement of Demat account and remainders.

When your demat account is closed, your account ceases to exist. Your DP will provide you form for closure of the account. You need to fill up the form and sign to ensure the closure of the account. If there are no dues outstanding from your side, the DP will close your account.

An trading and demat account is most required for purchasing and selling and holding shares. However the trading and demat account could become dormant if there are sustained periods of inactivity. And no trade can be made through an dormant trading account until the reactivation process is completed.

You do not have to pay any charges to close your demat account. Things to note for closing a demat account Remember the following points before closing your demat account: The account should be empty. You should not be holding any shares in it.

This charge is mandatory for the maintenance of your account, and it does not depend on the number of transactions in your account. Even if there are no transactions throughout the year, you have to pay for AMC if you have a Demat account. These are also called Folio Maintenance Charges.

If you don't pay the AMC then after some time, they will make your Demat Account inactive.

Closing an inactive demat account is important to protect investments and avoid unwanted charges and potential losses due to inactivity. The process is straightforward and involves downloading closure forms, attaching KYC documents and submitting the form to the depository participant.

Monthly maintenance/service fee

Account holders can tend to get out of their monthly fees by opening both a checking and a savings account at the same bank or by maintaining a minimum balance in your account. Sometimes, setting up a monthly direct deposit is enough to waive the monthly fee.

To reactivate your account, the first step would be to intimate the DP by sending an email or letter by post using your registered email ID or address. 2. Once the DP has been informed that you wish to reactivate your account, a fresh set of KYC formalities will have to be fulfilled.

Can a closed Demat account be opened again? ›

Reactivating a dormant demat account is not a difficult process. The first step is to check with the brokerage firm or depository participant (DP) to see if your account is actually dormant. This usually depends on the maintenance fees you pay and the length of time that the account has been inactive.

Demat and trading accounts of investors who haven't done a single trade, i.e. buying or selling stocks in his/her account for a period of 12 months, will be inactive. Dividend payments or corporate actions (credit of shares due to stock split or bonus) in the account will not be considered as a transaction.

1) Basic Account Closure - When there are no holdings, pending payments, or charges on a Demat account, the account holder can raise a request with the respective depository partner and have the account closed without any hassles.

The demat account cannot be closed without closing the trading account for the following reasons: Equity intraday positions have to be settled to the demat account if they are not squared off.

Disadvantages of a Demat Account are:

Additionally, you should be prepared to pay an annual maintenance fee, custodian charges, and transaction charges every time you sell an asset. Fortunately, 5Paisa offers eligible Indian investors the advantage of free Demat and trading account opening.

You cannot transfer money directly from your Demat account to your bank account. The trading account, which serves as the conduit between your Demat account and the bank, can be used for any transfers to your bank account. 2. Keep in mind that only the returns from the sale of securities may be cashed in.

No, it is not possible to close your Demat account online. To close the Demat account, you need to follow a few simple steps: First, fill out the Account Closure Form. Once filled, you need to visit the DP's office (it can be a bank or any investment firm) and submit the closure form with all the necessary documents.