Transmission of mutual fund units
When a unit holder dies, the claimant decides the form and the amount decides the paperwork.
Transmission is the transfer of mutual fund units after a unit holder dies. It is different from a transfer between living people. The claimant can be a surviving joint holder, the registered nominee or a legal heir, and who it is decides which form and which documents the RTA asks for.
The order is fixed. If the first holder dies, the units go to the second holder. If there is only one holder, or all holders have died, they go to the nominee, and failing a nominee to the legal heirs. The RTA must process a transmission request within 21 days.
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Which form for which case
Form numbers as given in the December 2024 Series II-B workbook.
Second or third holder dies
Form
T1
Units go to
No transmission; the deceased's name is deleted and the survivors continue
First holder dies, joint holders survive
Form
T2
Units go to
Surviving joint holder(s), the second holder becoming first
Sole or all holders die, nominee registered
Form
T3
Units go to
Nominee(s)
Sole or all holders die, no nominee
Form
T3
Units go to
Claimant / legal heir(s)
Karta of an HUF dies, HUF continues
Form
T4
Units go to
HUF stays; a new Karta is recorded
Karta dies, no surviving coparcener or HUF dissolved
Form
T5
Units go to
Claimant(s)
| Case | Form | Units go to |
|---|---|---|
| Second or third holder dies | T1 | No transmission; the deceased's name is deleted and the survivors continue |
| First holder dies, joint holders survive | T2 | Surviving joint holder(s), the second holder becoming first |
| Sole or all holders die, nominee registered | T3 | Nominee(s) |
| Sole or all holders die, no nominee | T3 | Claimant / legal heir(s) |
| Karta of an HUF dies, HUF continues | T4 | HUF stays; a new Karta is recorded |
| Karta dies, no surviving coparcener or HUF dissolved | T5 | Claimant(s) |
Documents every claimant gives
- check_circleThe transmission request form for the case.
- check_circleDeath certificate in original, or a photocopy notarised or attested by a Gazetted Officer or Notary Public.
- check_circleID proof of the deceased (PAN, redacted Aadhaar, Voter ID, passport or another OVD) attested by the claimant and notarised, or originals shown at an AMC branch for OSV.
- check_circleKYC of the claimant (or guardian, if the claimant is a minor). Transmission completes only when the KYC status is 'KYC complied'.
- check_circleBank proof: cancelled cheque with the claimant's name printed, or a bank statement or passbook not more than 3 months old.
- check_circleFATCA and CRS details.
- check_circleA separate PAN copy is not needed if the claimant is already KYC compliant.
Extra documents by amount when there is no nominee
Legal heir claims. Values are at the PAN level. Signature attestation rules for nominees follow the same Rs 5 lakh split.
Up to Rs 5 lakh
Signature attested by
Bank manager, in the prescribed format
Extra documents
Proof of relationship with the deceased; bond of indemnity from legal heirs; individual affidavit from each legal heir; NOC from the other legal heirs. With a succession certificate, probate, letter of administration or court order naming the claimant, an affidavit alone is enough.
Above Rs 5 lakh, below Rs 10 lakh
Signature attested by
Notary Public or Judicial Magistrate First Class (JMFC), on the form itself
Extra documents
Individual affidavits, plus either a notarised registered Will with a notarised indemnity bond, or a legal heirship certificate with a notarised indemnity bond and NOCs from all other legal heirs.
Above Rs 10 lakh
Signature attested by
Notary Public or JMFC
Extra documents
Individual affidavits, plus one of: notarised probated Will, succession certificate from a competent court, or letter of administration or court decree. ID proof of every legal heir signing an NOC or affidavit.
| Transmission value | Signature attested by | Extra documents |
|---|---|---|
| Up to Rs 5 lakh | Bank manager, in the prescribed format | Proof of relationship with the deceased; bond of indemnity from legal heirs; individual affidavit from each legal heir; NOC from the other legal heirs. With a succession certificate, probate, letter of administration or court order naming the claimant, an affidavit alone is enough. |
| Above Rs 5 lakh, below Rs 10 lakh | Notary Public or Judicial Magistrate First Class (JMFC), on the form itself | Individual affidavits, plus either a notarised registered Will with a notarised indemnity bond, or a legal heirship certificate with a notarised indemnity bond and NOCs from all other legal heirs. |
| Above Rs 10 lakh | Notary Public or JMFC | Individual affidavits, plus one of: notarised probated Will, succession certificate from a competent court, or letter of administration or court decree. ID proof of every legal heir signing an NOC or affidavit. |
Free account, this exam preselected.
Worked case: Mr Rao's folio
Illustrative. Mr Rao held units worth Rs 7 lakh in a single-name folio with no nominee. His two children survive him. The daughter is the claimant.
- 1
Intimation
The daughter informs the RTA with the death certificate and PAN. Once verified, debits in the folio are blocked and the KRA is updated. The family is sent the transmission form and document list.
- 2
Pick the form
Sole holder, no nominee: Form T3 for transmission to a claimant.
- 3
Pick the value band
Rs 7 lakh sits above Rs 5 lakh and below Rs 10 lakh. Her signature must be attested by a Notary Public or JMFC, not a bank manager.
- 4
Legal papers
She gives her individual affidavit and either the notarised registered Will with a notarised indemnity bond, or a legal heirship certificate with a notarised indemnity bond and an NOC from her brother attested by a Notary Public, JMFC or Gazetted Officer.
- 5
Common documents
Death certificate, attested ID proof of her father, her KYC, a cancelled cheque in her name and FATCA/CRS details.
- 6
Processing
The RTA has 21 days. The units move to her folio only when her KYC shows 'KYC complied'. She cannot redeem them before transmission is complete.
SEBI's ease-of-transmission rules for AMCs
SEBI circular of December 24, 2019, as summarised in the workbook.
- check_circleImage-based processing where the claimant is a nominee or joint holder, to cut processing time.
- check_circleA dedicated central help desk and a web page on the transmission process.
- check_circleA common transmission request form and NOC form, available on AMC, RTA and AMFI websites.
- check_circleA common set of documents for nominee and joint-holder claims.
- check_circleA uniform process for paying unclaimed amounts, including unclaimed dividends, to the claimant.
- check_circleNo redemption request from a claimant until the units are transmitted in their name.
Pledged units
If the units carry a lien, the lender's rights supersede those of the joint holder or nominee on the investor's death. Separately, if a borrower cannot repay, the lender may invoke the pledge and have the units transmitted in its favour.
How the Series II-B exam tests this
- check_circleWho gets the units: first holder dies, so the second holder. Sole holder dies, so the nominee, then legal heirs.
- check_circleNominee rights arise only on the death of all unit holders.
- check_circleThe Rs 5 lakh line: bank manager attestation up to it, Notary Public or JMFC above it.
- check_circleThe Rs 10 lakh line: above it, a probated Will, succession certificate or letter of administration is needed.
- check_circleHUF: the Karta's death does not end the HUF; a new Karta is recorded on Form T4.
- check_circleTAT for a transmission request: 21 days.
FAQs
What is transmission of mutual fund units?expand_more
The transfer of units to a surviving joint holder, nominee or legal heir after the death of a unit holder. The claimant applies to the RTA or AMC with a transmission request form and supporting documents.
How long does transmission of mutual fund units take?expand_more
The RTA must process a transmission request within 21 days. It completes only after the claimant's KYC status is 'KYC complied'.
Is a succession certificate needed to claim mutual fund units?expand_more
Only when there is no nominee and the value at the PAN level is above Rs 10 lakh, where a probated Will, succession certificate or letter of administration is required. Smaller claims can use indemnity bonds, affidavits and NOCs.
What happens if the second holder of a joint folio dies?expand_more
There is no transmission. The surviving holders submit Form T1 with the death certificate to delete the deceased holder's name, and may update the bank mandate and nomination.
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