How to Gift Stocks or SIPs on Birthdays (Instead of Cash)?
Gone are the days when birthday gifts were limited to cash, greeting cards, or something useful to the person’s life. Nowadays, families and friends are choosing to gift stocks and SIPs instead of traditional physical gifts.
According to recent data, monthly SIP contributions reached record highs in 2025. On similar lines, the mutual funds are also witnessing growth in the next decade.
You might be doubting whether we can really send stocks and funds as gifts. Well, yes, and the process is simple if you have the right information.
Why People Are Now Gifting Stocks Or SIPs
In reality, cash gifts get spent up somewhere, while stocks and SIPs will grow. With this new way of birthday gifts, it’s more than just money.
The receiver is likely to receive the investment that can increase in value over time. Moreover, they can also start learning about the investment.
What Gifting Stocks Or SIPs Really Means
In simple words, gifting a stock on birthdays means transferring some shares from your demat account to the receiver’s demat account.
Whether you transfer mutual fund units or start an SIP in their name, both make the recipient the owner of the investment.
What You Need Before Gifting Stocks or SIPs
| Requirement | For Stocks | For SIPs / Mutual Funds |
| Demat Account | Required | Not Required |
| Mutual Fund Folio | Not Required | Required |
| KYC | Required | Required |
| Guardian for Minor | Required | Required |
How To Gift Stocks Using Demat Platforms
Many broker platforms also provide the option of “Gift Stocks” in their portal. However, the steps to gift them to your friend or family member remain the same almost everywhere.
Step 1: Open your broker platform and search for the stock gift or transfer option.
Step 2: Enter the recipient’s demat ID and name.
Step 3: Select the number of shares you wish to gift on your birthday.
Step 4: The broker app will send the request to the receiver.
Once the receiver accepts the request, the stocks or units are likely to move via CDSL or NSDL. The stock units will start appearing in the receiver’s demat account.
Note: The share transfer process usually takes up 1-2 working days. It is better to start the process of sending SIP gifts on a birthday.
How To Gift SIPs Or Mutual Fund Units
- Send Existing Mutual Funds on Birthdays
- All you need to do is place a transfer request via CAMS or KFin as per the mutual fund.
- It will ask for your folio number, the receiver’s folio number, the scheme name, and the units.
- Once done, the units will be transferred to the receiver account.
- Start a SIP on Person’s Birthday
- This is another preferred option that requires the receiver’s KYC-verified account and a bank account for SIP debit.
- Once the mandate is set, the SIP will be active in the receiver’s name.
Tax Rules You Should Know Before Gifting SIPs Or Stocks
Usually, there is no tax involved with the gifting of stocks or SIP units. The receiver is likely to pay tax while selling them as per your original buying price and holding period.
Gifting stocks or SIPs to certain relatives is completely free from tax obligations. However, if the value crosses ₹50,000 for non-relatives, the same falls under income tax rules.
How The Recipient Sees And Uses The Gift
Once the stock or SIP gift transfer is complete, the receiver can find it in their demat account. The mutual funds will be available under their portfolio.
The receiver can track, hold, or sell them whenever they want with complete control. Since it becomes their investment after gifting, they can take actions for it like any other asset in their account.
Conclusion
Hence, gifting stocks or SIPs is not just a mere birthday gift but an investment for the person’s future that will likely increase with time. The process to gift stocks, SIPs, or mutual funds is simple, as you need just basic accounts and a few details.
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This analysis is for informational purposes only. Please consult a SEBI-registered financial advisor before investing.
– Chandan Pathak
Equity Research Analyst, StockYaari