How to Claim a Deceased Person's Bank FD & Savings (Nominee vs Legal Heir)
Verified July 2026 · General information, not legal advice — bank thresholds and document lists vary, so confirm with the specific branch.
- Nominee present → simplest: death certificate, claim form, ID.
- No nominee → legal heir certificate (smaller) or succession certificate (larger).
- A nominee is a trustee, not the owner — heirs are the real owners.
- Threshold for legal heir vs succession is often ~₹5 lakh (varies by bank).
- RBI: settle within 15 days of complete documents.
First: nominee or no nominee?
Everything depends on whether the deceased named a nominee on the account or FD. A nominee makes the payout quick — but understand what a nominee actually is: a trustee, not the owner. Under succession law (for example the Hindu Succession Act), the nominee receives the money and is legally bound to hand it to the legal heirs. Nomination decides who the bank pays, not who owns the funds.
Case 1 — there is a nominee
The nominee submits:
- Death certificate (original + copy)
- The bank's deceased-claim form
- Nominee's ID and KYC
- The FD receipt / passbook, if available
The bank verifies and releases the balance (or transfers the FD). For a joint account with "either or survivor", the surviving holder simply continues the account.
Case 2 — no nominee
Here the legal heirs must establish their claim. Banks broadly split this by amount:
| Amount | Usual requirement | Typical time |
|---|---|---|
| Smaller (often up to ~₹5 lakh) | Legal heir certificate + indemnity bond + no-objection from other heirs | ~30–45 days |
| Larger, or disputed | Succession certificate from a civil court | ~3–9 months (court time) |
The exact threshold varies by bank, so ask the branch which document they need for that balance before you start.
Documents for a no-nominee claim
- Death certificate
- Legal heir certificate (or succession certificate for larger amounts)
- Claim form signed by all claimants
- Indemnity bond and a letter of disclaimer / NOC from any non-claiming heirs
- ID/KYC of all heirs
Step by step
- Get the death certificate from the local municipal body.
- Check with the bank whether there's a nominee on the account/FD.
- If no nominee, obtain a legal heir (Varisu) certificate — or a succession certificate for larger amounts.
- Submit the complete document set to the branch in one go.
- The bank verifies and, per RBI, settles within 15 days of receiving all documents.
Avoiding disputes later
Because a nominee is only a trustee, families sometimes clash when the nominee treats the money as their own. The clean approach: the nominee collects the funds and then distributes to all legal heirs as per the succession law (or a mutually signed family settlement). If relationships are tense or the amount is large, a succession certificate or written family settlement avoids future litigation.
Joint accounts and FDs — the survivor mandate
If the account or FD was jointly held, the mode of operation decides what happens on a death:
| Mode | On death of one holder |
|---|---|
| Either or Survivor | The surviving holder(s) continue the account / receive the balance |
| Former or Survivor | On the former's death, the survivor gets it (and vice-versa per the wording) |
| Jointly (both to sign) | Needs the survivor and the deceased's legal heirs to settle |
For "either/former or survivor" accounts, the bank simply pays the survivor on producing the death certificate — no succession certificate is needed. But even here, remember the survivor may hold part of it in trust for other heirs, depending on whose money it was.
What RBI says banks must (and must not) do
The RBI has repeatedly told banks to make deceased-claim settlement simple and time-bound:
- Where there's a survivor or nominee, banks should not insist on a succession certificate, letter of administration or probate — irrespective of the amount.
- Where there's no nominee/survivor, banks must have a board-approved threshold up to which they settle against an indemnity, without demanding legal representation.
- Valid claims must be settled within 15 days of receiving complete documents.
If a branch insists on a succession certificate for a small, nominated account, politely cite RBI's guidance and ask to speak to the manager — you're often entitled to a simpler route.
Should you close the FD or let it continue?
When you inherit a deceased person's fixed deposit you usually have two choices: have it prematurely closed and paid out, or transferred/continued in the heir's or nominee's name until maturity. Banks generally allow premature closure in death cases, often without the usual penalty (this varies by bank, so confirm). If the interest rate is attractive and you don't need the cash, continuing the FD can make sense — just get it re-registered in the correct name first.
Tax on the interest after death
Tax responsibility splits at the date of death. Interest that accrued up to the date of death belongs in the deceased's final income-tax return, filed by the legal representative. Interest that accrues after death is taxable in the hands of the person who inherits the deposit (or the estate) for that period. Keep the bank's interest certificate, which usually splits the figures, so both returns are correct.
Nominee rules differ across products
A crucial nuance families miss: a "nominee" doesn't mean the same thing everywhere.
- Bank accounts / FDs, PPF, mutual funds, demat: the nominee generally receives the money as a trustee for the legal heirs.
- Life insurance: if the nominee is a "beneficial nominee" (a close family member — spouse, children, parents), they are entitled to keep the payout, not merely hold it in trust.
So the same person can be a mere custodian on a bank FD but the rightful beneficiary on an insurance policy. When in doubt about a specific asset, check that product's rules.
Bank lockers and other assets
For a locker, a nominee or survivor can access and remove the contents after the death certificate is verified, usually with an inventory taken in the presence of witnesses. Investments like shares, mutual funds and PPF each have their own transmission process with the respective registrar or post office — the death certificate and (where there's no nominee) a legal heir or succession document are the common thread across all of them.
Does a will change anything?
Yes. If the deceased left a valid will, the person named as executor claims and distributes the assets as the will directs — and in some cases the bank may ask for a probate (a court's certification of the will), especially for larger estates or in certain jurisdictions. A will overrides the default succession order, so a nominee still hands over the money, but it goes to the beneficiaries named in the will rather than the default legal heirs. If there's no will, the estate passes by the applicable succession law (for example the Hindu Succession Act, or the relevant personal law).
A practical timeline
| Stage | Typical time |
|---|---|
| Obtain death certificate | A few days to 2–3 weeks |
| Legal heir certificate (if no nominee, smaller amount) | ~15–45 days |
| Succession certificate (larger amounts / dispute) | ~3–9 months (court) |
| Bank settlement after complete documents | Within 15 days (RBI) |
The lesson: the bank part is fast (15 days); the delay is almost always in getting the heirship document. So start that step early and submit a complete set once.
Five things that speed up (or stall) a claim
- Check for a nominee first — it can turn a months-long process into a two-week one.
- Submit one complete set of documents, not in pieces — partial sets are the #1 cause of delay.
- Get NOCs from non-claiming heirs early — chasing signatures later drags it out.
- Keep multiple originals of the death certificate — every institution wants one.
- Update nominations on your own accounts now — so your family never has to go through the no-nominee route.
The lesson for your own money
The single kindest thing you can do for your family is to add a nominee to every account, FD, PPF, insurance policy, mutual fund and demat, and tell them where the papers are. A nominee doesn't override your heirs' rights, but it lets the bank release funds quickly in a hard moment — instead of your family navigating certificates and courts while grieving. Spend an hour on it this month.
Related guides
Also read our guide on the Legal Heir (Varisu) Certificate and, for property records, the Encumbrance Certificate. Reviewing family finances? See the gold loan guide and the FD calculator.
Frequently asked questions
How do I claim a deceased person's FD?
Nominee: death certificate + claim form + ID. No nominee: legal heir certificate (smaller) or succession certificate (larger) + indemnity.
Is the nominee the owner?
No — a nominee is a trustee who must pass the money to the legal heirs.
When is a succession certificate needed?
For larger balances (often above ~₹5 lakh) or disputes; it's issued by a civil court.
How long does the bank take?
RBI requires settlement within 15 days of receiving all documents.
Can the bank insist on a succession certificate for a nominated account?
No. Where there's a nominee or survivor, RBI says banks should not demand a succession certificate, regardless of the amount.
Is a will better than a nomination?
They serve different purposes. A nomination lets the bank pay out quickly; a will decides who ultimately owns the assets. Having both is ideal.
Who pays tax on the FD interest after death?
Interest up to the date of death goes in the deceased's final return; interest after death is taxed in the hands of the heir who inherits the deposit.
What if heirs disagree?
For disputes, banks require a succession certificate from a civil court, which decides the rightful claimants.
About the author. Written by Dinesh Kumar S, Chennai — B.Sc. Mathematics, M.Sc. IT — who runs Finance Guided and ComplyKraft to explain Indian money rules in plain language.
Disclaimer: General information, verified July 2026. Bank thresholds, documents and succession law depend on your situation and the bank — confirm with the branch and, for larger estates, a lawyer.
Dinesh Kumar S
Founder & AuthorDinesh is an accounts & GST compliance professional with 5+ years inside the Indian tax-compliance machinery at a Chennai-based IT services company. He writes a regulation-reader's column on Indian personal finance — every claim anchored to the actual Act, regulation, or circular it comes from. No product sales, no commissions, no paid placements.