How long can a demat and savings account remain in a deceased person's name, with or without a will?

What happens to a deceased person's bank and demat accounts, and how long can they remain in their name? Today's Ask Wallet Wise query explains the rules differ when the person leaves a valid will and when they die intestate, with legal heirs or executors required to follow a specific process to claim the assets. The Ask Wallet Wise initiative offers expert advice on personal finance and money-related queries. You can email your queries to askwalletwise@nw18.com, and we will try to get a top financial expert to address them How long can a demat and savings account be kept in the name of a deceased person, with a will or without a will?

There is no legal provision mandating the time period upto which a saving bank account and a demat account can be retained in the name of a deceased person whether a person has made a will or has passed away without leaving a valid will. There is a difference between retaining a bank/demat account in the name of a deceased person and operating it. Though the savings bank account can be retained after the death of a person, his cheque book, login and ATM card cannot and should not be used, legally speaking. Likewise, the operation of the demat account should cease immediately on the death of the person.

In case of a will, the executors can claim the money/securities standing to the credit of the deceased on submission of a valid will and copy of death certificate. The executors can open a bank account in the name of the estate of the deceased and operate the same till all the assets are distributed as per the instructions of the deceased in the will. The executor has to file a return as executor of the estate of the deceased till then. In case no will is made, the legal hair/nominee can claim the money/securities based on the proof of the person being a legal heir. The legal heirs have to pay tax on the income generated in these accounts after the death of the deceased.

If no claim is made within seven years, the money and securities standing in the name of the deceased get transferred to the Investor's Protection Fund, so it is in the interest of legal heirs to claim the money and securities standing in the name of the deceased as soon as possible. This is important from the point of view of inclusion of income earned in such accounts. The money/securities transferred to the Investor Protection Fund can be claimed, but the procedure is cumbersome and needs to be avoided. Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management.

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