Quick answer
How are RSUs taxed for IT employees in India?
RSUs are taxed as salary when they vest, on their market value, and the later sale is a capital gain. Shares of a foreign parent company must also be reported every year in the foreign assets schedule of ITR-2.
Common situations we sort out
You changed jobs during the year
Each employer gives you a Form 16, and each one usually assumes it is your only employer. The standard deduction and the lower tax slabs get counted twice, so tax is under-deducted. We combine both, work out the correct tax, and tell you any balance to pay before filing so you are not charged interest or sent a notice.
You have RSUs or ESOPs
- RSUs are taxed as salary when they vest, and ESOPs when you exercise them, on their market value at that time.
- When you later sell the shares, the gain or loss is a capital gain.
- Shares of a foreign parent company must be reported in the foreign assets schedule of your ITR every year you hold them, even if you sold nothing. Missing this can attract heavy penalties.
- Tax withheld abroad on dividends or sales can be claimed as a foreign tax credit, which needs a form filed before your ITR (Form 67, now Form 44).
Old or new regime?
The new regime has no tax for most people with salary up to ₹12.75 lakh. Above that, the old regime can still win if you have large HRA, home loan interest and 80C and 80D claims. Your employer's NPS contribution is deductible in both regimes, up to 14% of basic pay in the new regime. Try our tax calculator to compare.
You received a notice
The department regularly writes to salaried people about deductions claimed without proof, HRA claims, or income in AIS that is missing from the return. See our notice reply service.
Which ITR form?
- ITR-1: only salary, one house, interest income, and total income up to ₹50 lakh.
- ITR-2: if you have RSUs or ESOPs in a foreign company, foreign assets, capital gains above the ITR-1 limit, more than one house, or income above ₹50 lakh.
Due date: 31 July for ITR-1 and ITR-2.
What to send us
- Form 16 from every employer this year (Form 130 for tax year 2026-27 onwards)
- RSU or ESOP statements from your stock plan account (vesting, sale and tax withheld)
- Rent receipts and landlord PAN, if claiming HRA
- Investment and insurance proofs, home loan certificate, and NPS statement
- Bank interest certificates and any broker capital gains statement
See the full ITR documents checklist.
What clients say
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Within just 15 minutes, he completed all my work efficiently. I've never met someone so down-to-earth and approachable. He handled everything with great professionalism and took the time to understand my requirements patiently before proceeding.
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Common questions
I switched jobs. Why do I owe tax when both employers deducted TDS?
Because each employer applied the lower tax slabs and standard deduction as if it were your only employer. Combined, your income falls in a higher slab. We work out the exact balance before filing.
Do I need to report RSUs if I never sold them?
Yes. The value at vesting is already in your salary, but foreign shares you hold must also be reported in the foreign assets schedule of ITR-2 every year.
Can I claim HRA in the new regime?
No. HRA, 80C and 80D are available only in the old regime. Your employer's NPS contribution is allowed in both.
I declared the new regime to my employer. Can I file under the old regime?
Salaried people can generally choose the regime when filing the return, whatever they told their employer. If you have business income too, different rules apply.
Get a clear quote today
Send us a WhatsApp with a line about your situation. The first consultation is free, and we reply within one working day, usually the same day.