Restricted Stock Units granted by a US parent to Indian employees are taxed twice: once at vest as a salary perquisite and again at sale as a capital gain.
About this calculator
Restricted Stock Units granted by a US parent to Indian employees are taxed twice: once at vest as a salary perquisite and again at sale as a capital gain. Both happen in rupee terms because Indian tax law looks at fair market value on the vest date, converted at the SBI TT buying rate. What most employees miss is that the perquisite tax at vest can push their total income into a higher slab or a surcharge bracket, especially in the years when a big tranche vests.
This calculator takes your full vest schedule, applies the FMV-at-vest rule to compute the perquisite income, stacks it on top of your other salary, and computes the marginal tax attributable to the RSU piece under either the old or new regime. It then adds the surcharge (10% above 50 lakh, 15% above 1 crore, 25% above 2 crore) and the 4% health and education cess. When you sell, it works out whether the holding period qualifies as long-term (24 months on listed foreign shares) or short-term and applies 12.5% LTCG with a 1.25 lakh exemption, or 20% STCG.
Two things to double-check before you rely on the number. One: the employer's payroll usually deducts a flat TDS rate at vest that often over-withholds or under-withholds. Run this calculator to know what you actually owe and whether advance-tax top-ups are needed. Two: Schedule FA in the ITR must list the US shares as foreign assets, even in years you do not sell. See [[capital-gains-tax]] for the sale-leg math and [[income-tax]] for the salary baseline.
Common uses
- Tech employee with quarterly vesting deciding whether to sell or hold after the one-year cliff
- Comparing perquisite tax across old and new regime in a heavy vesting year
- Modeling the capital gains impact of selling 18 months after vest versus waiting past 24 months
- Estimating advance-tax liability after a 500-share tranche vests with a depressed stock price
- Planning year-end sell-to-cover versus holding through a market recovery
Frequently asked questions
How is RSU taxed in India at vest?
The fair market value of the vested shares on the vest date, converted at the SBI TT buying rate, is added to your salary as a perquisite. It is taxed at your marginal slab rate, plus surcharge if your total income crosses 50 lakh, plus a 4% cess. The employer typically deducts this as TDS and releases the remaining shares to your account.
What is the holding period for LTCG on US RSUs?
For listed foreign shares the holding period for long-term capital gain is 24 months from the vest date, not from grant. Sell before that and you pay 20% STCG. Sell after 24 months and you pay 12.5% LTCG with a 1.25 lakh combined annual exemption.
Does the new regime change how RSUs are taxed?
The perquisite tax at vest is the same, but you lose the Section 80C, 80D and similar deductions that would otherwise reduce total income. If RSUs push you past 15 lakh in a year, the marginal slab is still 30% in both regimes, so the new regime is usually simpler.
Do I need to pay advance tax on RSU gains?
Yes. The employer TDS on perquisite is often not enough to cover the full tax after surcharge, and capital gains on sale have no TDS at all for a resident. Estimate the shortfall with this calculator and pay advance tax in the quarter the sale happens to avoid Section 234B and 234C interest.
Do I have to declare US RSUs in Schedule FA every year?
Yes, regardless of whether you sold anything. Schedule FA lists foreign assets, including unvested and vested but unsold RSUs. Missing it attracts penalties under the Black Money Act. The calculator does not generate Schedule FA but reminds you to fill it.