I want to invest in mutual funds on my daughter’s name. Can I do so?
Surajeet Basu, Kolkata
When it comes to investing in the name of a minor, who could be anyone under 18 years old, the actual investing happens through a guardian. You, as the parent can hold units of a mutual fund and transact on behalf of your daughter. When investing in this manner, you will need to furnish documents regarding your relationship and proof of age of your daughter. If the intent is to create a corpus for your daughter, you could do so yourself and avoid this method of investing on her name. There is no tax advantage in doing so, as any gains when redeemed will have tax implications reflected in your income tax returns. It would be a better idea for you to invest in your name with the clarity of maintaining that invest for your daughter when she grows.
