Want to start investing for your child's future from age 5? A Minor Demat account lets you invest in their name with guardian control until they turn 18.
Who is a Minor?
Anyone below 18 years. Minor cannot directly open or operate a Demat account - requires a guardian (parent or court-appointed).
Documents Required
For the Minor
- Birth certificate
- PAN (can be applied for - mandatory)
- Aadhaar of minor
- Photograph
- Signature (can be guardian's on minor's behalf)
For the Guardian
- PAN
- Aadhaar
- Complete KYC
- Relationship proof (for legal guardian, not parent)
Opening Process
- Apply online (some brokers) or visit broker office
- Guardian completes e-KYC
- Upload minor's PAN, Aadhaar, birth certificate
- Link guardian's bank (not minor's)
- Activated in 3-7 days
What You Can Invest In
- Stocks (delivery only - no intraday)
- Mutual funds
- ETFs and bonds
- IPOs
What's NOT Allowed
- Intraday trading
- F&O / Options
- Currency derivatives
- Margin trading
Tax Implications
Income under Rs.1,500/year is exempt. Above that, income clubbed with parent's income under Income Tax Act Section 64(1A).
Exception: Income from minor's own skill/work is NOT clubbed.
At Age 18 - What Happens?
- Minor becomes major automatically
- Submit "Change Status" form to broker
- Fresh KYC in own name
- Account converts to regular Demat
- All holdings transfer to minor (now adult)
Power of Early Start
Rs.2,000/month SIP started at age 5 at 12% returns:
- Age 18: Rs.7.4 Lakh
- Age 25: Rs.24 Lakh
- Age 40: Rs.1.4 Crore
Same amount started at age 18 only gives Rs.50 Lakh at age 40. 13-year advantage = 3x wealth.
Zerodha Minor Account
Zerodha offers minor Demat with offline document submission. Apply through their support ticket system. Guardian opens their account first.
Start your own free Demat first - open via button below.
