How to claim a fixed deposit after the depositor dies

Fixed deposit receipts are often kept loose in files, but the reliable source is the bank itself: ask for a statement of all deposits held against the deceased person's customer ID, which will include deposits the family has no paperwork for.

The income tax returns and Form 26AS are the other good source, because tax deducted on deposit interest leaves a record against the PAN even where the receipt has been lost.

Check for deposits at more than one bank, and for older deposits at co-operative banks, which families frequently forget.

Jointly, with a survivorship mandate — where the account was opened with an "either or survivor", "former or survivor" or similar instruction, the balance is generally payable to the surviving holder on production of the death certificate, without a claim process in the usual sense.

Singly, with a nominee — the nominee claims. This is the common case and needs no court document.

Singly, with no nominee — the legal heirs claim, and the bank's settlement policy decides whether an indemnity and no-objection certificates suffice or a succession certificate is required.

Banks have their own deceased-claim form. Ask for the branch's "claim settlement" or "deceased claim" form rather than a generic account-closure form, which is a different thing.

Bring the deposit receipt if you have it. If it is lost, the claim can still proceed with an indemnity — the receipt is convenient, not essential.

Two Reserve Bank instructions are worth knowing. Where the deposit was either or survivor, or carried a registered nomination, banks have been told to release the balance to the survivor or nominee without insisting on a succession certificate, letters of administration, probate or an indemnity bond. And banks must settle a deceased depositor's claim within 15 days of receiving it, once proof of death and identification are in, reporting anything pending beyond that to their Board. Every bank must also publish its own policy covering the documentation for cases without nomination. Ask for that policy — having it in hand makes an unreasonable demand much easier to push back on.

A claimant can usually either close the deposit and take the money now, or let it continue to maturity. On closure, the Reserve Bank has directed banks to permit premature termination on the death of the depositor without any penal charge, and to write that term into the account opening form — so a penalty here is not the branch's discretion.

There is a catch running the other way, and it argues against dawdling. Where the deposit is prematurely terminated on death, interest for the period from the date of death to the date of repayment is paid at the savings deposit rate, not the contracted rate. The longer the claim takes, the more of that period sits at the lower rate.

If the deposit carries a good rate and the family does not need the cash, letting it run can be the better answer. If rates have risen since it was booked, closing it may be.

Interest earned up to the date of death belongs to the deceased person's estate and is generally reported in their final income tax return. Interest earned afterwards is generally the claimant's income.

Any Form 15G or 15H the depositor had filed stops applying, and tax may start being deducted where it previously was not. Check what the bank does with TDS after the claim, and get a revised certificate if needed.