Manage your investments better with secondary demat account
Every day brings market news, hot tips, and predictions that make us feel like we must act right away. Fear, greed, or even the thrill of a quick profit often push us into choices that hurt us in the long run.
Impulsive investing is one of the biggest reasons many fail to build lasting wealth. Chasing trends, timing the market, or selling too soon cuts short the real driver of wealth: compounding. And compounding only works when we give it time. Reacting to every market move stops our investments from growing steadily.
The way out is building systems that keep us disciplined and protect our long-term plans. That’s where a secondary demat account helps.
How it helps investors
Better investor behavior
Market volatility makes it hard to stay calm when stocks flash red. The secondary account keeps long-term holdings separate from trading positions, and they don’t even show up on your trading screen. If you do feel the urge to sell, you can’t do it instantly, you first need to transfer shares back to your main account, which takes a day. That pause acts as a cooling-off period, giving you time to think instead of panic-selling.
Separation of long-term investments and short-term trades
It also solves a tax problem. India’s First In First Out (FIFO) rule means your oldest shares are considered sold first, even if you meant to sell newer ones.
For example, imagine you bought a stock at ₹2,000 in January to hold long-term and again at ₹2,500 in March just for a short trade. If you sell the March shares, the system still treats it as if you sold the January ones first. This not only disrupts your long-term plan but can also lead to unexpected tax consequences.
With two demat accounts, FIFO applies separately. Your long-term investments stay untouched in the secondary account, while you can trade freely in the main account without accidentally messing up your tax plan.
A secondary demat helps you stay organized, make better decisions, and manage taxes more efficiently. You can open one for free on Console.
How to open a secondary demat account
- Log in to Kite.
- Click on your user ID and then on Console.
- Click on Account and then on Demat.
- Click on Secondary and then on Continue.
- Enter nominee details.
- Confirm the undertaking and click on Continue.
- Complete the In-Person Verification (IPV).
- Click on Sign Now.
- Enter your Aadhaar number, tick the undertaking and click on Get OTP.
- Enter the OTP you received and click on Verify OTP.
Your secondary demat account will be opened in 48–72 working hours. You’ll get an email confirmation from Zerodha, and it will appear under the Demat section in Console.
How to transfer shares to the secondary demat account
- Tap on your user ID.
- Tap on Portfolio.
- Scroll down and tap on the stock you want to transfer.
- Tap on Transfer to secondary demat account.
- Select the stock, enter the quantity to transfer and tap on Continue.
- Authorise the debit of stocks by entering the CDSL TPIN and OTP.
First-time setup: add secondary demat as beneficiary
- Between 3 and 5 PM on trading days, CDSL will email you a link.
- Enter your PAN and 16-digit demat ID
- Click Submit.
- Tick beneficiary details → Generate OTP → Accept → OK. (Once added, you won’t need to repeat this step.)
Confirm the transfer
- At 5 PM the same day, CDSL will send an email/SMS.
- Verify by 8 PM using PAN or demat ID with OTP.
- If you miss the 8 PM deadline, the transfer must be restarted.
Securities will reflect in your secondary demat account the next day. Transfer charges of ₹13 + 18% GST = ₹15.34 per security per transaction will be applicable for the transfer of shares.
Once transferred, shares won’t appear in Kite holdings but can be tracked on Console. To sell them, you will need to first transfer them back to your primary demat account using the same process explained above.
Check out this FAQ to learn more.
Hi,
I bought 100 shares of a company in 2022 and in 2024. (Total 200 shares at different buying prices).
If I transfer 100 shares from this to the secondary account, which shares will be transferred to secondary account?
A) 100 shares bought in 2022
B) 100 shares bought in 2024
C) None of the above
Basically I am trying to check whether the transfer to secondary account happens in the FIFO manner.
First bought will be first transferred to secondary account. Is that correct?
HI ZERODHA,
having gone through the contents and features being provided in a SECONDARY ACCOUNT, I do have few queries on the same
1) u say that the shares in secondary account cannot be PLEDGED and cannot be used as collateral
In this scenario, how do one get to pledge from his portfolio and how to get collateral to trade MTF, futures or options. This becomes a huge drawback in the feature and also trading volume and quantity will automatically get reduced since there is no MARGIN and collateral available. INSTEAD, isnt it better to allow pledging in seconday account which can be utilized to trade in PRIMARY Account.
2) The charges (OFFLINE) transfer fees are very high and is charged both ways.. This will only enrich ZERODHA revenues and the customer is unwantedly bound to pay lots of fees and tax on the same and becomes a burden for the traders.
3) 24 hours delay in transfer will also make the client lose opportunites and emergency cash needs..
Appreciate if a more easy and transparent model be provided soon
Zerodha is fraud.
Thanks Zerodha for this feature, I was waiting for it. For me the main reason to have primary and secondary demat at one place is measuring portfolio performance CAGR using Portfolio Performance (Beta) curve. I have opened the secondary demat account and moved some holdings to secondary demat account, they have disappeared from kite and I can see them in console with updated buy prices, the Portfolio Performance curve shows drop in value in proportion to holding moved to secondary demat account. So my question is will the portfolio performance curve shows the performance of both primary and secondary demat a/c or primary demat account only? How do I measure the portfolio performance of primary and secondary demat account?
Dear Team,
I appreciate the thought behind introducing the secondary demat account to separate long-term investments from short-term trades. The idea is indeed nice, but the process feels unnecessarily complicated for users. My feedback is as follows:
1. Please don’t make the process more complex. Simplicity is what makes Zerodha stand out.
2. Instead of creating a whole new account, you could provide a facility in the primary demat account itself that clearly categorizes holdings into long-term and short-term in real time.
3. Charging users for transfers between primary and secondary accounts feels unfair. This operational burden should not be passed on to customers.
4. There’s also a practical concern: when users want to sell long-term holdings during a market dip (for portfolio balancing or emergency needs), this separation may delay the process or cause confusion.
5. Another disadvantage is the increased administrative hassle—maintaining multiple accounts means more monitoring, reconciliations, and potential compliance issues (like nominations, PoA updates, and tax reporting). This reduces efficiency rather than improving it.
In short, while the concept is strong, the execution could be simplified and made more user-friendly. A categorization feature within the primary account may achieve the same goal without adding cost and complexity for users.
Hey Sayeed,
The categorisation feature within the primary account won\’t solve the FIFO behaviour related to taxes which was mentioned in the video. Right? IMO.
Anyways zerodha team can confirm here.
If i have 100 share of X company at avg buy price of 100. Now price of X down to price 20 , in this case of I transferred all my holding to secondary demat account after that again buy 100 share of X @ 20 rs then what will be the avg buy price at primary demat account?
Hi Amit, when you transfer shares between the accounts, the buy price and acquisition date will remain the same as the original; taking your scenario as an example, the buy price will remain Rs. 100.
What if a stock nose diving and you really want to sell?
It is better to allow people have 2 separate accounts.
By opening a secondary/ backup demat account – I also lose out on the option of making my one and only one Zerodha demat a BSOD demat account
!! SUGGESTION !!
In place of asking for secondary account, you could have created folders in the existing account and that will serve the same purpose.
This could have save account holders from additional unnecessary financial burden on us.
The secondary account transfer charges could have been made to ZERO else purpose of exercise is just not met, don\’t mind if transfer timeline is 24 hours but there should not be additional charges levied for the users my thought.
Portfolio manager
The whole process pain-stackingly explained in this article is same for any online new demat account opening process with any broker. Rest of the process for transfer of securities and charges explained are also same that will have to be followed with any new account. Then, can Zerodha clearly point-wise explain what\’s the benefit for existing Zerodha customers to open secondary demat account with zerodha only???
Q1. Will I be able to transfer my long term holding from other brokers to my secondary demat account?
Q2. Will I get option to select which date or month holding I want to trasfer to secondary account? Or it will strictly follow FIFO?
Hi Hardik,
1. Yep, you can transfer holdings to secondary demat from other brokers.
2. FIFO method is followed when holdings are transferred. If you are transferring from a primary account with Zerodha to secondary, the buy average will be automatically updated as per the original price and acquisition date. If you transfer from another broker, we give you the option to manually add the buy price.
you say it is completely free and then explain the charges behind it including AMC + TRANSFER CHARGES. Not right.
After transferring shares from primary to secondary demat account, can we see secondary demat account shares same as primary demat account in Portfolio section? If so, then in this case will have two portfolios in Kite app?
Hi Mayur, holdings in the secondary demat account will not show on Kite, but you can check these in Console holdings.
Dear Team,
I already have account with Zerodha,instead of opening secondary debate account, can you provide option to make two folders on zerodha console one for long term investment and second folder for short term investment. Tax calculation is not big deal as you are giving statement for whole year.
Noted your feedback, Manish.
Yes Shubham, providing secondary demat account option is a good feature or managing taxes.
But also, do consider providing option of creating folders in holdings. Whether a person can split even a single security into two or more folders may be avoided since the cost as per tax will be applied on FIFO basis.
Hi ,
Will this concept even work even for NRIs ?
Can we pledge our holdings in secondary demat account to use as margin in main demat account?
Hi Anshul, holdings in secondary account cannot be pledged. We\’ve taken this as a feedback.
Yes can you provide this feature as we trade on the pledge amount
Hi Shilpi, only resident individual accounts can open a secondary demat account. You cannot open one if you have NRI accounts or non-individual accounts (corporate, partnership, HUF, etc.).
Does FIFO apply while transferring from primary to secondary account?
For example, I purchased 100 shares in Jun-25 for long term, and another 100 in Aug-25 for short term. I now have 200 shares in total in my primary account. Now if I transfer 100 shares to the secondary, does it ensure that the first 100 is transferred?
Hi Utkarsh, yes, FIFO is applied when you transfer the shares. Also, when you transfer shares between the accounts, the buy price and acquisition date will remain the same as the original.
Better to give us a option to hide shares
Cost effective for your users
Good initiative for FIFO perspective and increase more demat account, more revenue. For others, please introduce folder system in Zerodha kite where one tag Individual stock with Folders. User simply select folder and see relevant strategy holdings. Please see Moneycontrol app portfolio folder view for an easy understanding
Secondary account mai 2 _3 Sal treding nahi kiya to account dormant hoga Kya
So does this Second Demat will attract Account Maintenance Charges separately?and if I have BSDA …will I be attracted with AMC ?
What will the charges for keeping a secondary account?
Hi Praveen, opening an account is free. For maintaining the account, there is AMC of Rs. 300 + 18% GST applicable per year.
Hello,
I would like to request a feature enhancement for the trading platform. Currently, when I purchase the same stock at different times and in varying quantities, it becomes cumbersome to manage sales through the existing setup.
For example, if I buy ITC stock multiple times—say, 10 shares each month—the system should allow me to:
• View all past purchases of ITC with purchase date, quantity, and profit/loss in a single row.
• Select the specific lots I want to sell using checkboxes.
• Execute the sale immediately for the chosen lots, without needing to move them to a secondary account or wait for a day when opting for long-term holdings.
This approach would make it easier to decide whether to treat a transaction as short-term or long-term, while also saving money by avoiding unnecessary offline transactions fee.
I strongly believe this feature will be very useful to investors, and if not implemented, other brokers who offer this functionality may attract clients seeking such flexibility.
Thank you for considering my request.
Hi Pandiiammal,
1. You can already view the breakdown of price, transaction date, and P&L for your holdings bought at different periods using the \”View breakdown\” option in Kite holdings: https://support.zerodha.com/category/console/reports/taxation/articles/view-ltcg-and-stcg-holdings
2 and 3. You cannot specifically choose which row to exit; IT rules mandate the First In, First Out (FIFO) method to be followed, so when you sell shares, those that are bought first will be sold first.
If you want to keep shares for the long term and also do short-term trades in the same stock, you can use secondary demat account for this.
This is the crooked and cunning plan of Zerodha. When a secondary account is opened, Zerodha will charge AMC for both the accounts. And transfer charge + GST for transfer from primary account to secondary account. Apart from that lot of complex and complicated process to transfer, unnecessary delay of transfer, stopping from quick selling. This help them to control the supply of stocks.
Agree, this is very simple .
Agree. this is simple .
If the Nominee is a minor and doesn\’t hold a PAN card, how to proceed?
Hi, in such a scenario, you can open the secondary demat account offline. You can create a ticket here and our team will help you with the process: https://support.zerodha.com/contact-us?article=open-secondary-demat-account-zerodha&category=ri-online
Call me once, have plan to open an account n want to discuss about the investment
A simpler solution might have been to provide a tag based view to customer.. instead of adding secondary demat and increasing fees on it and giving more business to NSDL/ CDSL..
why can\’t you introduce tag feature for customers and let them manage their holding as they want…
Its really a great initiative. I was looking for this kind of account and Zerodha has simply nailed it. Kudos to the entire Zerodha team.
Can I transfer securities (equities) from other brokers (say ICICI Direct) to Zerodha and then further transfer them to Zerodha secondary account? If yes, How do I go about it ?
Hi Vaibhav, you can transfer these holdings directly to secondary demat account. We\’ve explained the process here: https://support.zerodha.com/category/your-zerodha-account/transfer-of-shares-and-conversion-of-shares/transfer-securities/articles/how-do-i-transfer-shares-from-another-demat-account-to-my-zerodha-demat
Good initiative with lot of complications. Zerodha shouldn\’t be charge transfer fees from primary to secondary account. Instead if charge would be for other than zerodha accounts, it still sounds fare so, work on it. Also, for selling shares, it would be mess up to transfer from secondary to primary account then to it will take 24 hours, which might wouldn\’t be real time trade.
There needs to work out more on it before actual implication of the same.
Does this change our BSDA status?
Having only one DEMAT, we have a lower AMC since it is a BSDA account.
Will having this secondary DEMAT make our primary DEMAT non-BSDA?
Hi Rahul, yes, opening secondary demat account will make your account non-BSDA and AMC of Rs. 300 + 18% GST will be applicable for both accounts.
Thank you, Shubham
If there is drop down menu in kite itself with groupings allowed (eg, Short term, long term, etc), then no need for other demat and we can save on AMC charges on secondary demat and also transfer charges.
What charges will be levied for having a second demat account ? And if we are holding another demat account with other building can we link them to our Zerodha account to save the additional charges and easier access our holding with other broker linked demat account as well.
Hi Chirag, opening a secondary demat account is free. There is an AMC of Rs. 300 + 18% GST charged per year. Also, for transferring shares to and from secondary demat accounts, charges of ₹13 + 18% GST = ₹15.34 per security per transaction will be applicable. Demat account held with other brokers cannot be linked as secondary demat accounts.
Thank you for your continuous improvements, looking forward great features that will benefit both as Trader and Investor. Bhane ga har trader as an investor and har investor as trader.
Can the shares bought under MTF be transferred in secondary account?
No, Vikas. You will have to convert the MTF trade to delivery and then transfer the shares to the secondary demat.
If this feature was implemented earlier i would not have opened another demat with other broker
Its very complicated, buy in primary account and transfer to secondary and on selling transfer the securities back to primary account . My suggestion is that the primary account should be for trading purpose and the secondary account for longterm investment. There should be the provision for directly buying or selling from the both accounts. If it will be implemented in Zerodha, then we don’t require to open a separate account from other broker.
Thanks
Mukesh Kumar
I agree with Mukesh.
Hi,
I would like to understand on the following aspects on secondary demat.
1. ASBA linking for secondary demat for corporate actions like bonus, split, rights, etc
2. Partly paid shares will be credited to primary account or secondary account?
Thanks
Hi Srinivas, all corporate action benefits, such as bonus shares, splits, Rights Entitlements, etc., will be credited to your secondary demat account by default as you hold shares there.
Do i get pledged amount from stocks invested in primary demat account?
All the trading options/facilities provided in Primary account should be replicated in secondary account. The choice of buying/selling/keeping stocks should be left to the customer.
Listing some drawbacks of secondary account currently.
1. Unable to see the live performance of the portfolio of secondary account. Difficult to navigate to the Secondary account.
2. For shares that are transferred to Zerodha Secondary account through other Brokers, the buy average price is not getting updated automatically. Zerodha is asking the customer to update the Buy Prices manually.
3. I had also raised a ticket requesting Zerodha to add the Daily P&L in terms of Rupees in the Holdings Tab in Primary account, but they closed the ticket saying it will be considered. Most of the other brokers give this provision. This provision should be given in both Primary and Secondary accounts.
Good Initiative on the secondary account Zerodha team but if you are charging the AMC then customer deserves these provisions.
Hi Mahesh,
1. You can check the performance of stocks in the secondary demat account in Console Holdings.
2. Since we don\’t have purchase details for stocks transferred in from other brokers, we give the ability to add these details to the user itself.
3. Day\’s P&L is shown in Kite holdings for both the portfolio and individual stocks. For Console, we\’ll check on the possibilities.
I find this feature very useful, especially for trading. My approach has been to buy one share of each stock I want to track for trading or long-term investing, so I can monitor their performance and levels over time. This feature saves me time and gives me the advantage of keeping my long-term portfolio completely separate, which I don’t want to touch.
I do have one question: when moving shares between my primary demat and secondary demat accounts (in either direction), will there be any charges applied? Are there any government or hidden fees involved? If yes, could you please provide the exact transferring fees, including any such charges? Does the feture works during off markets and if yes what are the charges ??? If not yet plz dont put unless i am working for you guys or I Have investment in zerodha 😂😂
Hi Kush, charges of ₹13 + 18% GST = ₹15.34 per security per transaction are applicable for the transfer of shares from primary to secondary and vice versa. Also, there is an AMC of ₹300 + 18% GST per year for the secondary demat account. Other than this, there are no charges.
Please permit to devices at the same time for one account.
Hi Ashish, as per exchange guidelines, you can simultaneously maintain only one login session on Kite mobile and another on Kite web and not across multiple Kite app sessions. We\’ve explained this in detail here: https://support.zerodha.com/category/trading-and-markets/kite-web-and-mobile/others/articles/logged-out-of-kite
KINDLY CLARIFY THE TAX PART OF TRANSFER: WHEN I transfer shares from primary to secondary, are they considered as a SELL transaction in eyes of tax?
Hi Ashish, transfer from a primary demat account to a secondary demat and vice versa doesn\’t result in capital gains tax. We update the original buy price when the transfer is done.
If for selling we need to transfer it back to primary account then how we will save the tax? What is the need of secondary account.
Hi Ritesh, transfer from a primary demat account to a secondary demat and vice versa doesn\’t result in capital gains tax. We update the original buy price when the transfer is done.
Hi, This feature is good…
but what is actually needed is the feature similar to Watchllist. User should have a provision to group the items in the Holding into multiple buckets. this will help us to group stocks with similar objectives and act accordingly.
in the current option, all stocks are listed and it is confusing.. with this approach. i group stocks according to my plan and manage..
Hi Ashok, this is on our to do list. Thanks for your feedback.
I do not think just because you have a secondary demat account the tax implications will be different as regards short term and long term. It is a different matter if the demat account is with another broker and all the transactions are separate.
Hi Rajgopal, as per Circular No. 768 (June 1998), the FIFO method is used for dematerialised securities. If you have more than one demat account, FIFO is applied separately for each account. This is because every demat account has a unique account number and is treated as a separate account.
More here: https://support.zerodha.com/category/account-opening/resident-individual/ri-online/articles/open-secondary-demat-account-zerodha#h_75148983470331755676330209
I was thinking how to differentiate between the long term and short term investment in my demat and today I saw the secondary demat option. Thank you
Zerodha is like \”Ashram\” series Bobby Deol – Baba jane mann ki baat
I was eagerly waiting for this functionality.
Good one guys…….Keep up the good work.
Nice feature. Whether SGB\’s bought in primary account can be transferred to secondary account?
+1
You can, Parameswari.
the issue of collateral will pain many, as we use the long term as collateral for trades
Hello Zerodha,
Is this feature entirely free of charge ???
Hi Reddy, opening an account is free. AMC of Rs. 300 + GST per year will be applicable.
The most Pathetic service ever been offered by Zerodha ! Once you open your secondry demat acct first thing is they charge the yearly AMC for your secondry demat acct. Then comes the big twist – Once you transfer the shares from your primary Demat acct to secondry demat acct they will not let you tarnsfer it back for weeks as they keep showing error and multiple tickets raising and talking to all possible staff of zerodha is uselss, error will continue resulting in loosses as you cannot sell or buy through secondry demat acct, Big scam by zerodha and I am anywys planning legal so be very careful and avaoid this secondry option, rather open demat accts with other brokers !
You are absolutely right!
Hi Jitin, extremely sorry to hear about your experience. Checking this, will have someone from out team reach out at the earliest.
I suppose, the principle FIFO of equity for calculating Short term / Long term capital gains is for all shares held in one PAN, and they do not consider the Demat / physical paper holding. As per your narrative, when shares are transferred from one Demat Account to other demat account, the date of purchase of those shares changes to the date of Transfer. This is highly doubtful.
Hi Bharat, as per Circular No. 768 (June 1998), the FIFO method is used for dematerialised securities. If you have more than one demat account, FIFO is applied separately for each account. This is because every demat account has a unique account number and is treated as a separate account.
More here: https://support.zerodha.com/category/account-opening/resident-individual/ri-online/articles/open-secondary-demat-account-zerodha#h_75148983470331755676330209
Hi Shubham, could you tell me the order of shares that will be transferred from primary to secondary account. Will it follow the same existing principle FIFO or transfer to secondary account uses LIFO ?
Hi Ajay, yes, FIFO method will be followed when shares are transferred. Also, when you transfer shares between the accounts, the buy price and acquisition date will remain the same as the original.
Its a great solution however the back and forth process of first transferring the shares from main demat to secondary demat and vice versa for selling is going to be a big drawback.
The buying and selling should happen in the secondary demat itself. But I guess this is not possible due to regulatory as well as technical issues.
Yes, true. Its a solution but not that good. The back and forth process of transferring shares from secondary a/c to primary a/c and also will get charged for transferring the shares is definitely a drawback. Why not have the transfer free of cost since we are not really selling them but just transferring and seems like its going to take one whole day for the transfer.
What are the charges for opening a secondary demat account
Hi Sandhya, opening an account is free. AMC of Rs. 300 + GST per year will be applicable.
change the rule fifo give us freedom to sell what and this is not possible why creating puzzle
Its not up to Zerodha or anyone else to do that. The FIFO method is a requirement set by CBDT.
Is there any charges for secondary account like opening fee, AMC or annually or any charges?
Hi Ashvin, opening an account is free. AMC of Rs. 300 + GST per year will be applicable.
What are the charges for secondary demat account, is there any AMC ?or any type of fix/recurring charges ?
Hi Sarita, opening an account is free. AMC of Rs. 300 + GST per year will be applicable.
Hi, thanks for this enablement of secondary DMAT account.
How about the pledging of shares? Can we still pledge the shares in secondary account to trade F&O in primary account and vice versa to take margin benefit?
Hi Santosh, shares in a secondary demat account cannot be pledged. Will take this as a feedback.
Slowly accumulating stocks by minimum quantities and seeing this as a assets of total investments, to me is an addiction. so i never sell and not required secondary one( also ignore from Share transfer charges)
UNABLE TO OPEN SECONDARY DMAT ACCOUNT
Can we pledge the share from Secondary account?
Hi Riya, shares in a secondary demat account cannot be pledged. Will take this as a feedback.
No, you cannot use shares in your secondary account as collateral for trading or pledge them for margins.
Excellent feature!! Thanks a lot, Zerodha!!
How will the pledge for F&O from long term stocks work with 2 demats?
Hi Shriram, shares in a secondary demat account cannot be pledged.
what will happen to pledged holdings
Hi , thanks for making it live – was eagerly waiting for this solution but end product is somewhat different than one expected.
Reason – 2 way friction : buying in primary and trasferring to secondary demat and same loop in reverse while selling would be deterrent for wider adoption. Rather the buy should directly happen in secondary demat and for sell the routing via primary can be considered.
Please reassess the apporach. Thanks for always listening.
Totally agree with Satyakam\’s suggestion. The two-way friction of buying in primary and then shifting to secondary (and back again when selling) will definitely limit adoption. Direct purchase into the secondary demat would be far smoother and user-friendly, while routing via primary can be retained only for sales. This reassessment could really help improve acceptance.
I think buying directly in secondary demat account will defeat the FIFO logic and may be subjected to regulatory compliance …. The whole idea is based on the assumption that this secondary account is an OFFLINE entity though we are accessing online …. Just my thoughts … I might be wrong. !!!