How to Transfer Stocks From One Broker To Another?| HDFC securities
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Do you know how to transfer stocks from one broker to another? Let’s learn how!
Here are two friends discussing how to transfer stocks from one broker to another. Let us take a look at their conversation and understand the step-by-step process for transferring shares.
Ravi: Hello Shankar!
Shankar: Hello Ravi!
Ravi: I wanted to know if you could help me with information on how to transfer stocks from one broker to another?
Shankar: Yes, I certainly will help you out.
Transferring your shares can be as easy as porting your mobile operators in some cases. If your existing and new broker are both associated with the same depository, there will be an intra-depository transfer (or an off-market Transfer) of shares; otherwise it would be inter-depository transfer of shares.
Shares can be transferred either manually or online.
In the manual procedure, the account holder must fill the Delivery Instruction Slip or DIS issued by the DP.
Ravi: Delivery Instruction Slip? Yes, I have heard about it before. Could you please share more information on it?
Shankar: A Delivery Instruction Slip or DIS is issued by the DP and is similar to a cheque book issued by your banker. You need to submit a DIS duly filled to your DP for transferring your shares.
Ravi: Can you help me with how to fill in the DIS slip?
Shankar: Yes.
First, you write down the names of shares that you wish to transfer. You also need to give the 12-digit international security identification code or ISIN to identify the shares to be transferred.
Then, you enter a 16-character code that contains the ID of the DP. Ensure that you have correctly given the IDs of both, your current broker and new broker. Equally important is selecting the ‘off market transfer’ option for intra-depository transfer. If the mode of transfer is inter-depository, then the ‘inter-depository’ column should be selected.
You also need to give the correctly filled DIS to your broker who may charge you for this service.
You can do the whole intra-depository process online on the CDSL website as well.
Ravi: Oh, alright!
I got a fair idea.
Now, what about the tax implications on it?
Shankar: There is no tax implication if the beneficiary is the same person.
Ravi: Oh! That’s great!
I’m sorry. But I have another doubt.
Will the procedure remain the same if I am closing the demat account after transfer?
Shankar: No. In case of closure of one demat account, in addition to DIS, you need to also submit the Client Master Report or CMR. It is also important to remember that even for intra-depository transfer of shares, some brokers may ask for the CMR.
Ravi: I’ve heard of CMR but what exactly is it?
Shankar: Well, CMR or client master report is a document that carries the details of your demat account with the DPs ID, client ID, PAN, bank details, address, and other KYC details.
Your broker usually provides it on your request. The CMR will come handy if you transfer shares online from one broker to another.
Ravi: Great! Thank you so much! This was some wholesome education for the day.
It’s time now to get back to work. See you soon!
Bye!
Shankar: See you soon! Bye!
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