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Zerodha launched a secondary demat account for residents, accessible via Zerodha Console. It helps segregate holdings for better financial planning and tax optimization.
Zerodha allows investors to open a second demat account.
Retail brokerage major Zerodha has rolled out a secondary demat account facility for resident individuals. The new feature is accessible through Zerodha Console and is designed to help investors segregate their holdings for better financial planning. It offers investors greater flexibility in managing their equity holdings and improving tax optimisation.
A secondary demat account works alongside the existing primary account, creating a separate space to park securities. According to Zerodha, this structure allows investors to optimise taxes through improved First-In-First-Out (FIFO) management and maintain discipline by keeping long-term holdings separate from trading positions.
However, shares held in the secondary account will not appear on Kite, Zerodha’s trading platform. Instead, they will be visible only on Console. This ensures that long-term investments remain insulated from daily trading decisions.
Investors can transfer shares between their primary and secondary accounts seamlessly through Console. Buy averages are automatically updated and FIFO principles are applied during transfers. Transfer charges are Rs 25 plus 18% GST, while each demat account—primary and secondary—will attract an annual maintenance charge (AMC) of Rs 300 plus GST.
The feature is currently available only to resident individuals. NRIs, corporates, partnerships, and HUF accounts cannot avail of secondary demat accounts. Additionally, the facility does not support direct trading or collateral margin usage. To sell securities, investors must first transfer them back to their primary demat account before executing trades on Kite.
Account closure is only available through an offline process. Once activated, users will receive a separate TPIN for the secondary account via email, which can also be generated by entering the account’s BO ID.
Who can open a secondary demat account?
Only resident individual accounts can open a secondary demat account. This feature is not available for:
- NRI (Non-Resident Indian) accounts
- Non-individual accounts (corporate, partnership, HUF, etc.)
Can I trade directly from my secondary account?
No, you cannot trade directly from your secondary account. If you want to sell shares from your secondary account, you need to:
- Transfer the shares to your primary account online through Console.
- Sell them from your primary account through Kite.
Can I use shares in my secondary account as collateral for trading?
Currently, you cannot receive collateral margin against stocks in your secondary account. You cannot use these shares as pledge margins for derivatives trading.
Can I close my secondary account online?
No, you cannot close your secondary demat account online. You must follow an offline account closure process.
What will be the TPIN while transferring shares from my secondary account to primary?
Once activation is completed, you will receive the TPIN for your secondary account via email. You can also generate the TPIN by entering the BO ID for your secondary account.
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More
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