Dividends, capital gain tax, RSU foreign income and tax credit

Hi HMRC team, I hope you can advise on a few questions to finalize my self-assessment. 1/ I receive quarterly US dividends in my etrade broker account, I believe I need to report the dividends and pay tax in the tax year they arise, even in the money is in my broker account and not in my UK bank account, is that correct? i.e. 39.35% tax rate as I am in the higher tax bracket, with a £2k allowance and claim 15% tax credit for double taxation? 2/ my payslips shows "dividend equivalent" once a quarter. I think this is from RSUs vesting and is taxed at earnings (i.e. via PAYE). Is there any further action needed for this? i.e. this is not to be reported in foreign dividends? 3/ I am working in the UK for a US company which gives RSUs as part of the package (with RSUs granted/vesting depending on performance). Upon vesting, I generally keep the RSUs and sell some later in the tax year (i.e. I have to pay capital gain tax). What is the corret calculation to assess CGT? - Total proceeds (Sold price) minus Vested date Fair Market Value or - Total proceeds (Sold price) minus costs (I paid income tax paid during each vesting for the RSU batch, 47% tax withheld in my case shown on payslips) ... I am under the £12.3k CGT allowance this year using either calculations, but am keen to understand the right approach for future tax returns. 4/ My RSUs are shown in my P60 along with tax withheld (as such declared in my tax return under "Employment" in "pay from employment" and "UK tax taken off pay"). As such, do I have to claim tax credit for the tax in the foreign section under 'Employment, self-employment and other income which you paid foreign tax on' and if yes, how can I work out the correct level of tax credit I can claim back? Thank you very much & I look forward to hearing back from you

Hi 

1. yes you need to report this and it must be in sterling. you report the full amount as the dividend allowance is then given in the calculation  
2. no you dont include these as foreign dividends as is part of your pay    
3. disposal price minus costs. you do not include any PAYE tax as a cost  
4. As the payment is from your employer, the income should be shown in the employment section if it is included in your P60. You would then claim credit for the Tax in the foreign section under 'Employment, self-employment and other income which you paid foreign tax on'.
If it's not included in your P60, please include it on the box on the employment page for 'Tips and other payments not included on your P60'.  ERSM20193 advises that when RSUs payout at the market value on what is called ""dividend equivalents"" in either cash or shares, such payments will generally be taxed as earnings in the year they are received  ERSM20193 - Employment-related securities and options: what are securities: RSUs and dividend equivalents

Thank you

thank you, this helps for 1, 2, 4 but I have more questions on 3 as I find the information on this forum or the HMRC website confusing similar forum thread suggest: "If the value of the shares increases between when they vest and when you sell them, you will have made a capital gain" https://community.hmrc.gov.uk/customerforums/cgt/7c0e3fc5-c2b3-ed11-9ac4-00155d9c773d or "Selling the shares immediately upon vesting, ensures that there is no gain to tax" implying CGT is based on the difference between vesting date value and sold date value? https://community.hmrc.gov.uk/customerforums/cgt/883af4b8-17ae-ee11-a81c-002248004b84#b185719f-59bc-ee11-9078-00224841f0d0 For RSU costs, i thought the market value of the shares on the vest date (i.e. the amount processed through payroll) establishes the base cost for capital gains tax purposes? or from this https://www.gov.uk/hmrc-internal-manuals/employment-related-securities/ersm180040 (The cost of the securities is anything paid for the option, the exercise price paid for the shares, and any amount on which income tax was paid when the option was exercised). thanks for your help

and other similar thread on this forum with a great reference to the amount of those shares subject to Income Tax is added to the base cost of nil. https://community.hmrc.gov.uk/customerforums/cgt/e0329e62-e7f8-ed11-a81c-6045bd0e3464 Am below the threshold for this tax year but want to ensure I calculate with the right approach for the next tax year thx

Hi Valerie

If the sale is on the same day as the vest this is when no capital gains tax is due. If sold any time after this and there is an increase in value then capital gains is due.
When referring to PAYE, the previous reply confirms that the PAYE tax was not a deductable cost.

Thank you
 

Hi Valerie Heslot,
Restricted Stock Units, is a way for employers to provide incentives to employees over the long term.
As the payment is from your employer, the income should be shown in the employment section if it is included in your P60.
You would then claim credit for the Tax in the foreign section under 'Employment, self-employment and other income which you paid foreign tax on'.
If it's not included in your P60, please include it on the box on the employment page for 'Tips and other payments not included on your P60'. ERSM20193 advises that when RSUs payout at the market value on what is called "dividend equivalents" in either cash or shares, such payments will generally be taxed as earnings in the year they are received:
ERSM20193 - Employment-related securities and options: what are securities: RSUs and dividend equivalents
Thank you.