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Posted Sun, 04 Dec 2022 20:39:11 GMT by
Hi, I have vested some RSUs in the 21-22 tax year from my US employer. Through the scheme, they process applicable taxes (income tax, employee NIC and employer NIC) via payroll at the point of vest. I chose to retain all shares, so I paid the amount of applicable taxes they calculated out of my savings (in other words: no RSUs have been sold to cover my taxation liability, I paid to retain 100% of the shares). I have not sold any share (neither at vest, nor afterwards). When I complete the Self Assessment, do I have to complete the "Foreign income details" section? Do I have to declare the amount of taxes I paid (out of my savings) so it lowers my taxable income? Thank you for managing this channel, this is really useful!
Posted Wed, 07 Dec 2022 16:05:29 GMT by HMRC Admin 2
Hi,

You will complete the foreign section to claim any foreign tax credit relief in respect of the American taxes paid.

You cannot reduce the amount in respect of taxes paid out of your savings

Thank you.
Posted Fri, 09 Dec 2022 13:38:07 GMT by
Thanks for your reply. My company calculate taxes of my RSUs following the UK rules (including employer and employee NIC). That should mean that I do not have any tax credit relief. If that is the case, do I have to complete the foreign section anyway? Thanks!
Posted Mon, 12 Dec 2022 16:32:30 GMT by HMRC Admin 32
Hi,

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'.

Thank you.
Posted Mon, 20 Nov 2023 19:10:09 GMT by
Hi - Looking for some guidance on my below situation please: I am employed by a Tech company who are headquartered in the US, but I work for the UK part of that business. I receive RSUs on a vesting schedule, and I am in the process of filing my tax return for FY22/23. During that FY I had two vest dates. On vesting, ~48% of the RSU value was sold to cover taxes, the remainder reinvested as shares. So as far as I am aware, i have already paid all due taxes on this RSU income. I have not cashed out any shares, so don't have capital gains responsibilities on those shares yet. My 'Total for year' income on my P60 shows the total income from my basic salary + income from RSUs (the remainder that wasnt sold to cover taxes). Whilst filing my tax return, I can see that my annual personal allowance has been reduced quite significantly, I believe because it is being calculated based on the total income (Basic salary + RSU income, which pushed my total income above the £100K threshold), rather than on just the basic salary amount. My assumption is this is incorrect, as it means my 'Total income on which tax is due' is higher than it should be, ie: becasue its assuming tax hasnt already been paid on the RSU proportion of my income. So - 2 questions: 1. Should I record my income on my tax return, ie: should it be the total amount as per my P60 (including Base salary + RSU income), OR should it be just by base salary (becasue tax has already been paid on the RSUs) 2. Although my employer is US headquartered, I work for the UK division, and all other/standard taxes are paid via HMRC. Do i need to report RSUs as 'foreign income' in my tax return, or do anything differently? Im not aware if it actually classed as foreign income or not. Thanks in advance!
Posted Wed, 22 Nov 2023 16:40:25 GMT by HMRC Admin 10
Hi
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.  
Employment Related Securities Manual 

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