Want To Gift Shares? A Step-By-Step Guide To Transfer Your Stocks Off-Market From Demat To Demat

Last Updated:March 23, 2025, 11:32 IST

Learn how to transfer shares off-market from one Demat account to another with this step-by-step guide. Understand DIS forms, charges, tax implications, and important considerations for a smooth transfer process.

Transferring shares off-market from one Demat account to another is a common practice for investors who wish to move their holdings for personal reasons, asset reallocation, or gifting shares. Unlike on-market transfers, which involve selling shares through stock exchanges, off-market transfers are conducted directly between two parties without involving exchange trading.

Here’s a step-by-step guide on off-market share transfer process, including the necessary forms, charges, and important considerations.

What is an Off-Market Share Transfer?

An off-market transfer involves moving shares between two Demat accounts without executing a trade on the stock exchange. This type of transfer is typically used for:

– Gifting shares to family members

– Intra-account transfers (moving shares between two Demat accounts owned by the same individual)

– Inheritance or succession transfers

– Private sale or settlement between two individuals

– Corporate restructuring or promoter transfers

Step-by-Step Guide to Transfer Shares Off-Market

Step 1: Ensure Both Accounts are Active Before initiating an off-market transfer, confirm that both the sender and receiver have active Demat accounts with a Depository Participant (DP), such as NSDL or CDSL.

Step 2: Obtain the Delivery Instruction Slip (DIS) A Delivery Instruction Slip (DIS) is a form provided by your DP that allows you to transfer shares. You can request this slip from your DP’s branch or download it online (if supported).

Step 3: Fill in the DIS Form The DIS must be completed with the following details:

Beneficiary Account Details: The recipient’s Demat account number

ISIN (International Securities Identification Number): A unique identifier for the specific shares being transferred

Stock Details: Name of the company and the number of shares being transferred

Consideration Amount: Mention if the transfer is a gift or sale

Reason for Transfer: Choose the correct reason from the available options

For NSDL accounts: You may also need to mention the DP ID and client ID of the recipient.

For CDSL accounts: The target Demat account number is required.

Step 4: Submit the DIS to Your Depository Participant (DP)

After completing the DIS form, submit it to your DP along with supporting documents (if required). Some brokers may also require the signature of both the sender and receiver for verification.

Step 5: DP Processes the Transfer

The DP will verify the details and process the transfer request. The shares should reflect in the recipient’s Demat account within 2-3 working days.

Charges for Off-Market Share Transfer

Off-market transfers are subject to transaction charges, which vary based on the DP.

Note: Stamp duty may apply if the transfer involves a consideration amount (e.g., sale of shares).

Things to Keep in Mind

Same Depository vs. Different Depositories: If the sender and receiver have Demat accounts under the same depository (NSDL to NSDL or CDSL to CDSL), the process is simpler. If they are with different depositories, you need to fill an ‘Inter-Depository Transfer’ form along with DIS.

Gift Transfers & Tax Implications: If you are gifting shares, ensure proper documentation. While there is no tax on gifts received from close relatives, capital gains tax may apply when selling those shares.

Signature Verification: The DIS form must have the correct signature as per DP records; any mismatch can cause rejection.

Avoid Mistakes in ISIN or Account Details: Incorrect details can delay the process or result in a failed transfer.