Distributors are no longer required to request for asset transfer if they plan to float a proprietorship firm.
In a note sent to AMCs, AMFI said that it has received requests from distributors to ease the process of changing status from individual to sole proprietorship.
However, the new norms will be applicable to distributors having same PAN number for individual and sole proprietorship firm.
Here is the new procedure to change status for distributors who wish to float proprietorship firm
- Open a separate bank account in the name of sole proprietorship
- A new application form has to be submitted to AMFI in the name of sole proprietorship along with EUIN form
- The application form has to accompany a demand draft of Rs.2360 in favour of Association of Mutual Funds in India
- Submit a self-declaration on the letterhead of the firm. You can download a format from AMFI website
- Surrender original ARN card issued in your name (individual license)
- The validity of the new ARN will commence from the date of submission of documents and fees. It will expire with the expiry of current validity of the individual ARN (i.e. according to the existing ARN, which you have surrendered)
- Remember to share this change in status with RTAs
For distributors who have separate PAN for sole proprietorship firm, they will continue to surrender existing ARN and apply for fresh ARN for the new firm. Once you get ARN of your proprietorship firm, you will have to make a transfer of assets request within six months of cancellation of your previous ARN.
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