No, you cannot transfer shares to anyone as a simple transaction however, you can transfer shares stocks to them as a gift. But mind you, there are several strings attached to it. Because of that, you can counter-argue that, what’s the difference? It’s one way or another, but there is a difference.
The difference arrives on the brokers, and the rules for which it is applied. To understand it read the complete article.
Table of Contents
- Can I Transfer Shares to Another Demat Account?
- Can I Transfer Shares to Another Person’s Demat Account Holder?
- Can I Transfer Shares to anyone as a Gift?
- Will gifting of shares invites taxes?
Can I Transfer Shares to Another Demat Account?
Yes, one can transfer their shares to another Demat account. However, both of the demat accounts have to belong to the same person. In the case of a jointly owned demat account, one can only transfer the shares to a joint demat account with the same owners.
Transfer of shares from one demat account to another can be done offline as well as online.
To know better about both of the methods, I will suggest you read an article by icicidirect.com where they have not only explained the procedure of transferring your shares from one demat account to another both online and offline additionally, they have also given clarity on blood relations and tax implication related to the transfer of shares in demats.
Can I Transfer Shares to Another Person’s Demat Account Holder?
No. You cannot transfer shares to a demat account that isn’t owned by you. The same goes for the case of the joint holding demat account also.
As of now, most of the share transfer is being done through dematerialized accounts i.e. demat accounts. As of the current rules and regulations, the demat account brokers don’t let you transfer shares from one to another dement account with different owners.
Even in the early days of the stock Indian stock market, when the stock was in the form of physical paper, the Swapping of owners of shares after its sales was nearly next to impossible, because of the chance of rules and regulations.
Can I Transfer Shares to anyone as a Gift?
Yes, but more often than not, it depends on your broker. While in the case of online brokers, the Zerodha platform allows you to transfer shares as gifts to another person. But Angel One and Upstox don’t let you do that.
For many people, it may appear that transferring shares to another person and gifting shares is the same. However, this isn’t the case, both of them are distinct and rules are different for both of them.
While the rules don’t allow shares transfer, it allows gifts but under the subject of tax. Moreover, the most common intention of gifting this share is to avoid income taxes. Moreover, if you have the same intentions for gifting your shares, read the next topic before proceeding.
Will gifting of shares invites taxes?
Yes, it surely will. However, the taxes will be levied on the receiving person. Traditionally, gift taxes were levied on sending persons but because of the abolition of GTA (Gift Tax Act), the sender is not liable anymore to pay taxes on gifting the share.
In case, if you are having capital gains from the transfer of shares to another person who is not your parent, sibling, wife, or children the capital gains from the transfer of shares will be taxed and the time will decide whether it is short-term capital gain (<12 months) or long term capital gain(>12 months) and will tax accordingly.
More specifically if the price of shares exceeds ₹50,000 and the receiver is above 18 years then, without any consideration, the receiver is a bite to pay taxes on the share gifted.
For more information, you can refer to the article on Zerodha. And if you are thinking about stock marketing with Artificial Intelligence then first check it out the video below.
If you are thinking about opening a Demat account. There are some top brokers for your trust Angel One, Upstox, Groww, and Paytm Money.
If you are in search of brokerage-free trading, Read the article to learn about it – Use These Platforms for Zero Commission Demat Account in 2023.
https://dematdive.com/can-i-transfer-shares-from-one-person-to-another/
