₹18.6 lakh RSU vest taxed as salary, ₹3,47,760 gain at 12.5%
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RSUs from a foreign parent. Taxed twice in two places if you miss a step.
IT or MNC employee with RSUs or ESPP of a foreign company
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- RSU and ESPP from a foreign parent: vesting perquisite, INR value and TDS
- Foreign shares, RSU and ESOP sale with Schedule FA
- Foreign income and RSUs
- Income tax return with capital gains, ITR-2
Send any one of these to start
- Salary slip
- Form 16
- Investment statement
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Salaried? Your ITR, filed by a CA on WhatsApp.
Send Form 16 and AIS; we pick the regime, file and e-verify.
1 working day after documentsIf you wait: Late fee ₹5,000, or ₹1,000 if income is up to ₹5 lakh (Sec 428, old 234F)
Free first stepSee your tax in 30 secondsSold shares or property? File ITR-2 the right way.
We read broker and CAS statements and file ITR-2 with every schedule.
2 to 3 working daysIf you wait: Late return: ₹5,000 fee and no carry forward of capital losses (Sec 428 and 121, old 234F and 80)
Free first stepSee the capital gains rate tableNRI with Indian income? File from abroad, stress free.
We confirm your residential status and file ITR-2 with treaty relief.
2 to 3 working daysIf you wait: Late fee ₹5,000, or ₹1,000 if income is up to ₹5 lakh (Sec 428, old 234F)
Free first stepCheck your residential status
Questions, answered the CA way
Facts, Provisions and law, Analysis, Conclusion.
ESOP for foreign parent company: Schedule FA and FEMA
- Facts
- Indian employees receiving ESOPs from a foreign parent company (US, Singapore holding structure) face additional compliance:
- Provisions and law
- FEMA 1999 | IT Act, Schedule FA | RBI AP DIR 14
- Analysis
- Schedule FA in ITR: Foreign assets must be disclosed in Schedule FA of the ITR. This includes foreign ESOPs (granted, vested, exercised, and held). Non-disclosure = ₹10L penalty under Black Money Act. FEMA: Acquisition of foreign shares through ESOP is permitted under a general permission from RBI. But the shares must be reported in Form APR (Annual Performance Report) by the employee's employer. Tax: FMV in INR on exercise date (convert at RBI reference rate) = perquisite value. Gains on sale are taxed as capital gains (foreign equity = debt CG rules, slab rate regardless of holding period for individuals).
Schedule FA, Foreign Asset Disclosure in ITR: What, When, How
- Facts
- Every ROR (Resident Ordinarily Resident) must disclose ALL foreign assets in Schedule FA of their ITR, bank accounts, property, shares, ESOPs, signing authority. Missing even one account: Black Money Act. Penalty: ₹10L per undisclosed asset. No time limit for IT to reopen. This is the one compliance you cannot skip.
- Provisions and law
- Black Money Act 2015; Schedule FA, ITR-2/3; FATCA / CRS; Sec 263 (old 139), mandatory filing
- Analysis
- FATCA is real and it works: Indian IT department receives automatic data from USA, UK, Canada, Australia, UAE (from 2024), Singapore, and 100+ countries annually. Foreign banks report Indian customers. If you haven't disclosed: IT already knows. What must be disclosed: Any bank account where you are owner OR signing authority. ESOPs of foreign company (even unvested, even zero value). Foreign property. Shares in foreign company (even a startup equity grant worth $1). Trust as beneficiary. What details are needed: For each bank account: peak balance during year (highest balance on any single day), closing balance (March 31), interest earned, account number, SWIFT/IBAN, country. For ESOPs: company name, number of shares, acquisition date, cost, value.
- Conclusion
- List every foreign bank account (checking, savings, FD, brokerage), include closed ones (peak balance year still needed)
- List all foreign property: residential, commercial, land
- List all ESOPs/RSUs from foreign company employers, even unvested
- List signing authority in any foreign entity (director, trustee, authorized signatory)
RSU vs ESOP vs SAR: what structure works for which employee
- Facts
- ESOP (Employee Stock Option): Right to buy shares at a fixed price. Employee must pay exercise price. Upside = FMV growth. Most common in India.
- Provisions and law
- Companies Act 2013 | SEBI SBEB Regs | IT Act Sec 16 to 18 (old 17)
- Analysis
- RSU (Restricted Stock Unit): Promise to deliver shares (or cash equivalent) on vesting. No exercise price, employee gets shares free on vesting. The entire FMV on vesting date = perquisite. Better for mid-senior hires who need less risk. Common in MNCs and large Indian tech companies. SAR (Stock Appreciation Right): Employee gets the cash value of price appreciation, no shares issued. Good for employees who don't want share ownership but want upside. No dilution for company. Taxed as salary on exercise.
TDS on Salary: Section 392 (old 192)
- Facts
- The most voluminous TDS in India, every employer deducts on estimated annual salary. Most errors in TDS happen here: wrong regime, missed deductions, dual employment.
- Provisions and law
- Sec 392 (old 192); Sec 392 (old 192(2)); Sec 392 (old 192(2B)); Form 124 (old Form 12BB); Sec 204, 201 (now 398)
- Analysis
- How salary TDS is computed: Step 1, Estimate gross salary for full year. Step 2, Add any other income declared by employee (Form 124, old Form 12BB). Step 3, Deduct loss from house property if declared. Step 4, Deduct allowances (HRA, LTA to extent exempt). Step 5, Deduct Sec 123/126, Income-tax Act 2025 (old Sec 80C/80D) etc. if old regime. Step 6, Compute tax on net income. Step 7, Divide by 12 months remaining = monthly TDS. Common employer errors: (1) Default to new regime without checking employee's declaration. (2) Not collecting Form 124 (old Form 12BB), missing HRA and home loan deductions. (3) Not aggregating other employer salary in job-switch year. (4) Not giving effect to Sec 392 (old Sec 192(2B)) house property loss declaration. Employee duty: Submit Form 124 (old Form 12BB) with proofs by February 28 each year. Declare other income/loss if applicable. If employer TDS seems wrong, check payslip and Form 130 (old Form 16) mid-year.
- Conclusion
- Employee submits Form 124 (old Form 12BB) by April (start of year), regime declaration, HRA, home loan, Sec 123 (old Sec 80C) estimate
- Employer updates payroll software with regime and deduction inputs
- Monthly TDS computed on estimated annual income, deducted each month
- If employee joins mid-year, collect Form 122 (old Form 12B; previous employer income) and aggregate
RSUs from a foreign parent. Taxed twice in two places if you miss a step.
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