RSU Tax Calculator (Foreign Employer, India)
RSUs from a foreign employer are taxed twice: as salary perquisite when they vest, and as capital gains when you sell. See both, whether your employer withheld enough, and whether the sale is short-term or long-term.
10 shares vested at USD 150.00 each (₹1,32,000 total, converted at ₹88.00/USD) — that whole amount is taxed as salary this year, costing ₹27,456 at your slab. Your employer sold 4 shares to cover it, worth ₹52,800 — which covers the actual tax with ₹25,344 to spare — expect that back as a refund or adjustment when you file. The remaining 6 shares land in your account with a cost basis of ₹13,200/share — that's what future gains are measured against, so you're never taxed twice on the same value.
| At vesting | |
|---|---|
| Perquisite value (salary income) | ₹1,32,000 |
| Tax on perquisite (your slab, incl. 4% cess) | ₹27,456 |
| Value of shares employer withheld | ₹52,800 |
| Excess withheld — refundable | ₹25,344 |
| Cost basis for the credited shares | ₹13,200/share |
| At sale — held 6 months (short-term) | |
|---|---|
| Sale proceeds | ₹84,480 |
| Cost of shares sold | -₹79,200 |
| Capital gain | ₹5,280 |
| STCG tax (your slab, incl. 4% cess) | ₹1,098 |
| Tax on the sale | ₹1,098 |
| Net proceeds after tax | ₹83,382 |
- FMV
- Fair Market Value — what the share was actually worth on a given day, in the currency your employer grants in (USD, EUR, etc.). For listed shares, that's simply the closing (or opening, per your plan rules) price on the exchange that day — you then convert it to ₹ yourself using the exchange rate field.
- Perquisite
- The taxable value of a benefit given by an employer other than cash salary — here, the FMV of shares on the day they vest, taxed as salary under Section 17(2)(vi).
- Cost of acquisition
- For capital gains, your "cost" for these shares isn't ₹0 — it's the FMV on vesting day (the same figure already taxed as perquisite), under Section 49(2AA). You're only taxed again on the gain since that day.
- STCG / LTCG
- Short-term vs long-term capital gains. For foreign-listed shares (not listed on an Indian exchange), the long-term threshold is 24 months from vesting — unlike the 12 months for Indian-listed shares.
- Section 112
- The flat 12.5% rate (no indexation) that applies to long-term gains on unlisted/foreign shares, since Budget 2024. There's no ₹1.25 lakh exemption here — that only applies to Indian-listed equity under Section 112A.
- Rule 115 (SBI TTBR)
- Foreign-currency income must be converted to ₹ using the State Bank of India's telegraphic transfer buying rate on the last working day of the month before the transaction — not whatever rate an app shows you that day.
- Sell-to-cover
- Many foreign employers can't withhold Indian tax through payroll for stock, so they sell part of your vested shares immediately and remit the proceeds as TDS — the rest lands in your brokerage account.
- Schedule FA
- Once you hold foreign shares (even through a company plan), you must separately declare the brokerage account and the shares in Schedule FA of your ITR — regardless of whether you sold anything that year. Penalty for missing it can run up to ₹10 lakh.
Simplified for general guidance — new tax regime only, one vesting tranche and one sale, no surcharge, no old-regime comparison, and no adjustment for capital losses or multiple lots. Section 87A rebate eligibility for capital gains has been genuinely disputed in practice; treat any figure near the ₹12L rebate threshold as approximate. Doesn't cover ESPPs, dividends, US withholding/DTAA credit (Form 67), or LRS remittance rules. Confirm with a tax professional before filing.