Tax Treatment on Restricted Stock Unit (RSU)

POSTED BY Anjani Singh ON July 30, 2012 3:05 pm ONE COMMENT

Hi Manish,

Can you please help forum members with “How to compute tax on RSUs issued and vested on a specific dates”? If the RSUs are sold after 1 year after the timeframe when it was vested (deposited) in your trading account, will it be computed as long term or short term? How will the tax be computed? Also, in case of MNC the RSUs are provided in NASDAQ via Etrade or some other brokering firm, which USD to INR conversion value will be used? Who will provide the conversion rate, etc. etc.

Your help in this regard will surely help me and others.

Anjani Singh

One reply on this article “Tax Treatment on Restricted Stock Unit (RSU)”

  1. Shree says:

    Hi Anjani,
    When RSU gets vested, perquisite tax is applicable and it is calculated and deducted as per follows-
    ( Fair Market price on date of vesting) less ( Grant Price( for RSU mostly it is zero))*Vested RSU* applicable tax rate
    When RSU are sold afterwords then it will be capital gain tax as per holding period of RSU and tax is calculated as capital gains —- (Selling price – FMP on vest date)* Qty sold .
    For checking dollar conversion rates you can refer

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