How to Transfer Mutual Funds from One Broker to Another?

Many investors want to know if it is possible to transfer mutual funds from one broker to another without selling and rebuying for units held in demat form. This process, when executed correctly, avoids triggering capital gains tax and keeps the original investment history intact. In this article, we explain whether mutual fund transfers are allowed, outline the step-by-step process, potential costs, required documents, and key checks to ensure a streamlined transition.

Table of contents

• Can mutual funds be transferred?
• How to efficiently transfer mutual funds to another brokerage?
• Monitor the transfer progress
• Confirm the transfer completion
• Review and update your investment portfolio
• How to transfer mutual funds from one demat to another?
• Steps for the transfer of mutual funds in case of death
• How to transfer mutual fund amount to bank account?
• What will be the mutual fund transfer fees and taxes?
• What are the documents for the transfer of mutual funds?
• When should you consider the mutual fund transfer?
• Considerations before transferring mutual funds

Can mutual funds be transferred?

Yes, under certain conditions, mutual fund units can be shifted from one broker (or platform) to another without redemption, through in-kind transfers. However, this is not universally permitted. When units are held in demat form, they may be moved via depository infrastructure (NSDL / CDSL) because they are comparable to securities.

For units held in demat form, transfers are processed through the depository infrastructure (NSDL/CDSL). For units held in a Statement of Account (SoA), transfers may now be possible online through RTA portals or platforms like MF Central for many schemes (excluding ETFs).

When units are held in Statement of Account (SoA) or non-demat form, the transfer must follow the AMC or RTA protocols as per the “Transfer of Units” rules. The AMC must permit such transfers (for eligible schemes), units should not be under lock-in or lien, and both old and new folios need to be KYC validated.

Also note: Individual gifting (transfer between living persons) of mutual fund units is generally prohibited by AMCs except in demat cases and under certain rules. Transfers due to death (transmission) are a separate process.

Therefore, it is possible to transfer mutual fund holdings, subject to the rules of the specific scheme and the concerned RTA.

Read Also: How to Transfer SIP Between AMCs: Step-by-Step Guide

How to efficiently transfer mutual funds to another brokerage?

This is a brief guide for transferring funds without redeeming, through in-kind transfers:

• Open an account with a new broker / platform: Confirm that the new broker is able to keep mutual funds in a demat or SoA scheme, that they have access to the same AMCs, and that your PAN / KYC details are consistent.
• Obtain the "Broker Change/Transfer Form": The new broker (or AMC/RTA) will provide a form you complete to request an in-kind transfer of the units. You have to fill in the source folio/ demat account, scheme name, number of units, and destination broker /account details.
• Submit the forms to the two parties: Submit the transfer request to the RTA or AMC of your previous broker and the new broker (if applicable), providing any necessary proof of identity / PAN / KYC.
• Request the transfer to be in-kind (without liquidation): Request that the units be transferred in kind or be moved as is, rather than selling and reinvesting. This avoids triggering taxes or realising potential gains.
• Wait for the transfer to be processed: The RTA / AMC / depository system will process the transfer. Standard timelines will vary; however, typically 5 to 7 business days for demat transfers and 7 to 10 business days for SoA transfers.
• Confirm there are no exit-load / restrictions: Some schemes may limit immediate redemption of transferred units for a few days or have other restrictions. For example, after transfer, units may not be redeemed for 10 calendar days.
• Monitor progress & follow up: Continue to monitor progress with the respective broker and RTA and resolve any issues promptly.

This process allows you to transfer your holdings without triggering an immediate tax event and while maintaining investment continuity.

Monitor the transfer progress

During the transfer period:

• Check status updates in your old broker/AMC/RTA portal.
• Watch for email / SMS alerts from AMC or RTA confirming request acceptance or rejections.
• Resolve mismatches: If your PAN, name, account details don’t match, the transfer may be rejected.
• If transfer stalls beyond the expected period, raise a complaint with RTA / AMC investor service.

Timely monitoring is important because even minor discrepancies in PAN or name details often lead to rejections

Confirm the transfer completion

Once the transfer is done:

• Units should appear in your new broker account and folio.
• Confirm the number of units, the scheme name, cost/purchase history.
• Compare with the old broker’s statement to ensure no unit is missing.
• Check that AMC / RTA records show the new broker name / ARN (if applicable).
• If the mismatch persists, contact AMC / RTA with supporting documents immediately.

Review and update your investment portfolio

After transfer:

• Reassess whether all investments still align with your goals, horizon, and asset allocation.
• If you had SIPs running via the old broker, stop them there and start fresh ones via the new broker.
• Rebalance if needed, since your cost base and holdings may now present slightly different ratios.
• Ensure your new broker supports consolidated view / performance tracking for ease of oversight.

How to transfer mutual funds from one demat to another?

If your mutual funds are in dematerialised (demat) form, you can transfer them from one demat account to another (same or different depository participant).

Steps:

• Submit a DIS (Delivery Instruction Slip) via your old DP / broker specifying DP ID, target account, ISIN/scheme code, and units to transfer.
• With some brokers, the process may be done online via transfer menu.
• The RTA/depository processes the transfer via NSDL / CDSL.
• Typically it takes a few business days (e.g. 2–5) depending on infrastructure.

However:

• Units under lock-in (ELSS) cannot be transferred until the lock-in period ends.
• Stamp duty may apply when transferring for consideration (non-gifts) in SoA transfers.
• In-kind demat transfers do not trigger capital gains tax.
• Converting SoA holdings into demat or vice versa is possible if scheme or AMC supports that.

NSDL allows holdings in dematerialised form, enabling you to use your existing demat infrastructure. Therefore, the demat-to-demat route is often a straightforward method for in-kind transfers when available.

Steps for the transfer of mutual funds in case of death

When the original investor passes away, the mutual fund units must be transmitted to the nominee or legal heir. This is not a broker-to-broker transfer but a change of ownership.

Process:

• Submit a Transmission Request Form to the AMC/RTA.
• Provide documents: death certificate, KYC/identity proof of legal heir or nominee, bank proof, nomination record, and indemnity bond if required.
• If there is a nomination, the transfer of units to the nominee is generally more straightforward; in the absence of a nomination, the legal heir may require a succession certificate or will
• The AMC / RTA updates the folio registration.
• After that, the new owner/nominee may choose to stay with the same broker or shift holdings further.

Because this is a change in ownership, it is governed under transmission rules, not generic broker transfers.

Read Also: Seamless Transmission of Mutual Fund Units after Unitholder Death

How to transfer mutual fund amount to bank account?

“Transfer to bank account” means redeeming the mutual fund units and having the proceeds credited to your registered bank account.

• Submit a redemption/withdrawal request via your broker or AMC / RTA.
• The units are sold at applicable NAV; any exit load or holding period conditions will apply.
• The proceeds are credited to your bank account registered in the folio.
• Redemption proceeds for equity-oriented schemes are generally credited on T+1 working days, aligned to market settlement, per industry adoption and SEBI timelines .
• This route does trigger capital gains tax (if relevant) as it is a sale.

This option may be suitable when you intend to cash out; avoid it if your goal is merely to shift brokers while staying invested.

What will be the mutual fund transfer fees and taxes?

Fees & charges

• Broker /DP/service fees: Some brokers or DPs may charge a processing fee for facilitating transfers.
• Stamp duty: Stamp duty of 0.005% applies on purchases/switch-ins, and 0.015% on off-market transfers such as transfers between demat accounts.
• Demat transfer charges: DPs commonly levy a transfer fee + 18% GST, for moving MF units between demat accounts. Actual tariffs differ by DP and users should check their DP tariff card.
• Many SoA transfers (within the same AMC) may not carry a charge if the AMC/RTA permits broker change at no cost.
• A scheme ‘switch’ is treated as redemption plus purchase, and capital gains tax applies as per asset class and holding period.

Taxes & capital gains

• When units are moved in-kind (no sale), the transfer itself does not create a capital-gains event; taxation applies when you eventually redeem/sell.
• If you redeem and then reinvest, you may incur:
  • For equity funds: Long-term capital gains on equity funds are exempt up to Rs. 1.25 lakh; gains above this are taxed at 12.5% for sales on/after 23 Jul 2024, while sales before that date follow the earlier Rs. 1 lakh exemption and 10% rate; Short-term capital gains are taxed at 20% for sales on/after Jul 23, 2024; redemptions before that date remain at 15%.
  • For non-equity funds where ≤35% is in domestic equity, investments made on/after April 1, 2023, are taxed at your slab rate, irrespective of holding period under Section 50AA.
  • Exit load (if within lock-in) may reduce your net proceeds.

Hence, the in-kind transfer method avoids triggering an immediate taxable event; redeeming and reinvesting may trigger costs.

What are the documents for the transfer of mutual funds?

Here’s the checklist:

• Valid KYC / identity proof/address proof and PAN.
• Broker change / transfer request form duly filled, with old and new account/folio details.
• In the demat case: DIS/delivery instruction or online transfer instructions.
• Statement of account / holding proof of units.
• For transmission (in case of death): death certificate, nomination record, legal heir documents, indemnity bond, and identity of claimant.
• If units are under restriction (freeze/lien), a waiver or lien release may be needed.
• In case of a change of distributor (broker), the ARN / distributor code details, if applicable.

Make sure all forms are signed by required holders (joint holders, etc.) and submitted in original/certified as required.

When should you consider the mutual fund transfer?

You may consider transferring when:

• You find a broker /platform with lower fees, more suitable service, or features.
• You are consolidating multiple holdings under fewer platforms.
• Your current broker is winding down operations or becoming non-responsive.
• You wish to move from a regular plan to a direct plan (though that often requires redemption).
• You want more suitable reporting, analytics or consolidated dashboards under one broker.

However, avoid frequent transfers, as they may invite administrative friction or delays.

Considerations before transferring mutual funds

Before initiating the transfer, keep these points in mind:

• Eligibility: The scheme must permit unit transfers, and units should not be locked, liened, or frozen.
• KYC matching: PAN, name, and holder details must exactly match in old and new accounts.
• Depository compatibility: Demat transfers require both brokers / DPs to support the same depository (NSDL / CDSL).
• Exit load or holding period: Ensure you may not incur charges or violate conditions.
• Cost vs benefit: If transfer fees or delays are high, benefits may be marginal.
• Timeline and market conditions: If the market is volatile, a delay in transfer might affect the value (if you redeem).
• Record continuity: Ensure cost basis and purchase history migrate properly.
• Service reliability: It may be useful to research the reliability, support, and reputation of the new broker.

Conclusion

Transferring mutual funds from one broker to another is feasible, provided units are eligible and the process is carefully managed. Using the in-kind transfer (demat or SoA broker change) route lets you retain your investment continuity without triggering a tax event. Follow the proper forms, monitor each step, ensure matching KYC, and verify continuity once done. After completion, review and update your SIPs or holdings under the new broker.

FAQs

Can mutual funds be transferred from one broker to another?

Yes. Mutual fund units may be transferred from one broker or platform to another, provided they are eligible for such transfer. This generally requires that the units are not under lock-in, the investor’s KYC and PAN details are valid and consistent, and the AMC or RTA permits an in-kind transfer.

Can I transfer funds from broker to broker?

You can transfer the units, not cash. The investment units move from one broker’s custody to another’s.

Can I transfer investments from one broker to another without selling?

Yes. Mutual fund holdings may be shifted from one broker or platform to another through an in-kind transfer, where the units are moved without redemption. Such transfers do not generally trigger capital gains tax, provided ownership remains unchanged and the transfer is executed as per AMC or RTA guidelines.

How to change the MF broker?

Request a “broker change/transfer form” and submit it to your AMC or RTA along with your identity and folio details.

Can I change brokers without selling my investments?

Yes, that is precisely what an in-kind transfer allows (you don’t sell).

Is it difficult to change brokers?

The process involves paperwork and coordination between different entities. The level of complexity may vary depending on whether the holdings are in demat or SoA form.

Can I transfer mutual funds without paying taxes?

Yes. You may change your broker or platform without redeeming your investments through an in-kind transfer, wherein the existing units are moved as is. This process allows you to retain your investment continuity without triggering a sale, subject to eligibility and applicable AMC or RTA procedures.

Can I remove a broker from a mutual fund?

Yes. You may request an update or removal of the distributor or broker code (ARN) in your mutual fund folio by submitting a change request to the respective AMC or RTA. This process does not affect your existing units or investment value, as only the broker/distributor information in the folio is modified.

How long does it take to transfer from one broker to another?

Typically, 5–7 business days for demat transfers; 7–10 days for SoA transfers.

How do I change my broker online?

If your AMC or RTA portal supports “broker change/transfer” online, you can fill in the new broker ARN and folio details; otherwise, manual submission is needed.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

This document should not be treated as endorsement of the views/opinions or as investment advice. This document should not be construed as a research report or a recommendation to buy or sell any security. This document is for information purpose only and should not be construed as a promise on minimum returns or safeguard of capital. This document alone is not sufficient and should not be used for the development or implementation of an investment strategy. The recipient should note and understand that the information provided above may not contain all the material aspects relevant for making an investment decision. Investors are advised to consult their own investment advisor before making any investment decision in light of their risk appetite, investment goals and horizon. This information is subject to change without any prior notice.

The content herein has been prepared on the basis of publicly available information believed to be reliable. However, Bajaj Finserv Asset Management Ltd. does not guarantee the accuracy of such information, assure its completeness or warrant such information will not be changed.The tax information (if any) in this article is based on current laws and is subject to change. Please consult a tax professional or refer to the latest regulations for up-to-date information.