under a joint name is considered convenient by many to avoid the legal hassles and delays caused for establishing successionship. From bank accounts to HUF accounts to property transfer, there is a whole lot going for it in terms of having a joint ownership. While it is a convenient way to do so in a it does come with certain limitations. Here are some things to consider if you intend to be a joint holder for a .
A Joint Holding should be between two individuals or a maximum of three account holders. Tounder joint names all investors should be compliant.
2. Mode of Ownership
One has to establish joint holding while filling the application itself by selecting the mode of joint or either or survivor. One needs to ensure that the mode of holding has to be specified while filling the application else thehouse treats default as joint.
Joint ownership means equal rights and authority to all investors, which means to purchase or redeem units or perform any operations approval i.e. signature and details of all joint owners are required. The either or survivor mode will allow either of the owners to transact on the account.
In an either or survivor mode either of the joint account unit holders can performon the account; while in a simple joint account mode, document modification and changes on the count end up becoming a tiring affair due to compulsory submission of details of both account holders. Joint ownership means equal rights and authority to all investors, which means to purchase or redeem units or perform any operations approval i.e. signature and details of all joint owners are required. The either or survivor mode will allow either of the owners to transact on the account.
4. Benefit of joint ownership
A joint ownership will be beneficial for you when you do not want the other holder to take unilateral decisions on the. Similarly, it helps with easy transfer of in the joint ownership. This may be particularly useful to protect rights of certain individuals as the rights of joint holder supersede the rights of nominee in succession matters.
The main holder will gain tax benefits on ELSS (Equity linked Saving Schemes) i.e. the tax saving schemes in the either or survival mode of joint ownership. Similarly, long or short term tax will also come in picture only for the first joint account holder.
Nomination comes into effect on joint accounts only after the death of both joint account holders. Minors cannot be a part of jointaccounts
So, if you feel that you need to secure someexclusively for an immediate family member such as your spouse, do a joint holding to ease succession and ensure their financial security.