How to declare vested RSU shares tax has already been paid ?

I am a UK tax payer. In February 2023, some of my RSU shares, in US, was vested. On the vesting day, some released shares were sold to pay for tax in UK by my employer. I am holding the rest of the released shares. In my February 2023 payslip, the value of the vested shares (before tax) was added to my taxable pay, but strangely the tax on vested shares was not collected. (So the tax paid in the payslip did not include the tax on the vested shares.) But I have a share account statement saying tax was paid on the vested shares. In the online self assessment form for April 2022 to April 2023, how do I declare tax on the vested was already paid, so that I avoid being tax again on the vested shares ? Thanks in advance for your assistance ! Shing

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 is 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.

Through a corporate restructure bringing in new investment my former company accelerated the vesting schedule of my Restricted Stock Units. On the P60 they have included the equity gross gain in my total pay but have not reflected the tax deductions. Essentially, they withheld a portion of the total RSUs to account for national insurance and capital gains tax. I am currently awaiting a detailed breakdown of how the figures on my p60 were calculated. The concern here is that I'll have to pay additional tax on the gains included in my income which they have confirmed in correspondence were made net of any capital gains tax/NI to my account. Just want to ensure I’m not being taxed twice. I still hold the vested shares.

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.  

ERSM20193 - Employment-related securities and options: what are securities: RSUs and dividend equivalents

Thank you.

Hi there - similar to the above, I'm a UK tax payer and for the past two financial years, I've had some of my RSU shares (in the US) vest. On the vesting day, some released shares were sold to cover tax in the UK by my employer. In my February 2023 and February 2024 payslips, each recognises the values of shares vested as "taxable income from shares" . There's also a "net cash proceeds line" (not sure what this means). My gross pay is now artificially higher and so is my PAYE tax. I was hoping for some guidance as I continue to pay tax on a higher salary (but as pointed out by the OP above, I've already paid tax via Sell to Cover). I can't see anything that refers to the shares in my P60 either. How do I know if the tax on the vested shares has been declared and I'm paying the right tax?

Hi,
As the payent is from your employer, the details will be included within your P60 as your total income. Any breakdown is then likely to be in your payslips.
You can check the correct rates here:
Income Tax: introduction
Thank you.

Straight forward help needed please. I need to declare a foreign amount from an RSU payout abroad. It was paid out untaxed abroad in EUR and is entirely liable to UK tax. The amount was correctly not included in my P60 as it had nothing to do with my current UK employer. Is it correct to declare this gross amount (in GBP) on: A. The Employment Supplement, page E1, box 3 "Tips and other payments not on your P60" AND B. The Foreign Supplement, very top section of page F6 (stating zero tax taken off and no tax credit claim) OR just on A, OR just on B ?? The notes are very ambiguous on this. Please clarify. Thank you.

Hi,
If it is 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'.  The following guidance 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 for the reply, but this RSU payout income was received ABROAD UNTAXED. I know I am liable to only pay UK tax on it. I still need clarification if the amount in GBP should ... ONLY be included in the employment page / section "Tips and other payments not included on your P60" OR ALSO on the The Foreign page, very top section of page F6 even if zero tax has been taken off (abroad) and there is no tax credit claim? Thanks 

Hi ,
 

If no foreign tax was deducted from the RSUs, then you only need declare them in the tips and other payments not included on your claim.  The foreign section would only be needed if you paid foreign tax and wanted to claim a tax credit. Thank you .

Good afternoon. Like others on this thread, I am a UK tax payer, and receive regularly (several times per year) vestings of RSU in the US. So far my company has treated each vesting as a taxable gain, and deducted all taxes related to this gain from my monthly pay. They are now proposing a "sell to cover" and will pass the proceeds of the sale of the RSU (enough to cover taxes) on vesting date directly to me, outside payroll. My payslip will therefore remain the same as before - showing the full amount of taxable gain, and the full tax deduction made to cover all due taxes. How do I declare the money received from my company which isn't included in payroll, but is the proceeds of selling RSU? Thank you.

Hi Miranda,
In your Self Assessment tax return, in the employment section.  
You would enter the income in box 3 'Tips and other payments not on your P60'.
Employment Tax year 6 April 2023 to 5 April 2024 (2023–24).  
If you have foreign tax deducted from the RSU's, you declare this in the foreign section and claim a foreign tax credit.
Thank you.

Good afternoon, I am also a UK tax payer. I retired from my former Hong Kong employer in 2021. As a good leaver (due to retirement), restricted shares granted to me during employment continued to vest as per share plan. These restricted shares were subject to 4-year vesting. I recently received the vested restricted shares. Upon vesting, these shares are ordinary shares and no longer subject to the share plan. Do I need to declare the value of these shares as earnings given they are granted to me due to my retirement?

Hi,
If you received cash on vesting, this is declared in the foreign section of your tax return. If you retained the shares after vesting, there may be a capital gain arising on their disposal. This would be declared in the capital gains section of the foreign section of the tax return. You can see guidance here:
ERSM20192 - Employment-related securities and options: what are securities: Long Term Incentive Plan (LTIP)
Thank you.

Thank you for your reply. Just to make sure I understand the guidance ERSM20192 correctly and report accordingly. In this case I will retain the vested shares - does it mean that I do not have to report it now? I only need to report a capital gain, if any, arising in the future when I dispose them. In addition, HS305 Employment-related shares and securities — further guidance (2022) states that "You will not be chargeable to tax if your shares cease to be subject to the plan because you ceased employment for one of the following reasons: - injury or disability - redundancy - a change of employment under the Transfer of Undertakings (Protection of Employment) (TUPE) Regulations 2006 - a change in the control or sale of the company you work for out of the group - retirement - death" Does this HS305 apply to me given I have already retired in 2021 and the shares only vested this year. Thank you.

Hi ,
 

You need to declare the vested shares when they vest, as this is taxable as income.  If from a non UK Company, you may have paid foreign tax.  You can claim a foreign tax credit in your tax return.  As you have retained the shares after vesting, they become subject to capital gainst tax when they are disposed of, where the disposal value is greater than the vested value. Thank you .

Hi, I had RSU vesting in Feb 2025 (in the US) where they sold shares to cover for tax and NI payments. In my March payslip, the full value of the RSU was included in my taxable pay, and the corresponding tax amount was deducted. I.e. I was taxed twice. The P60 doesn't break these out, it just shows one number for total taxable income for the tax year (which includes the full value of the vested shares) and one number for total tax paid (which includes the tax value of the vested shares). I want to claim foreign tax credit in my self assessment - tried to do so in the foreign income section but it doesn't allow me to fill in any details. Could you please advise how to proceed? Thank you

Hi yunnis,
Employer's ususally include the vested income in a P60.  
When they do not, the vested shares are declared in box 3 of supplementary page SA102 or the online box 'Tips and other payments not on your P60' in the employment section.  
Where shares were sold to cover the tax payable, the income and the tax are declared in the foreign section supplementary page SA106, columns A - F on page F2 in the section headed ' Interest and other income from overseas savings', or in the online boxes for 'Interest and other income from overseas savings'.  
A foreign tax credit relief is declared in box F2.
Thank you.