RSU tax hub · United Kingdom
UK residents with US RSUs
PAYE + NIC at vest (up to 47% combined). CGT on sale at 18%/24% post-30 Oct 2024. US-UK DTC reduces dividend WHT to 15%. SA106 (foreign income) + SA108 (capital gains) on Self Assessment.
Executive summary
UK residents holding US RSUs face one of the world's more complex equity comp regimes — three layers stacked on top of each other. At vest, US RSUs are treated as employment income under section 471 ITEPA 2003, taxed via PAYE at marginal rate (20%/40%/45%) and subject to National Insurance Contributions (8% on £12,570-£50,270, 2% above). Your UK employer's payroll handles the withholding. The vest value lands in your P60 / payslip — verify it matches your US broker's reported value.
Subsequent sales are Capital Gains Tax events. Post-30 October 2024, CGT on shares is 18% (basic rate) / 24% (higher and additional rate). The £3,000 annual exempt amount is the only buffer. The cost basis for CGT computation = FMV at vest in GBP using the HMRC rate on vest date. Selling at a sterling-depreciated time can convert a USD loss into a GBP gain — the currency leg often surprises UK holders.
US dividends paid into your US broker account face 15% US withholding under Article 10 of the US-UK Double Taxation Convention (with W-8BEN filed). The 15% is creditable against UK income tax on the same dividend via foreign tax credit on SA106. Without W-8BEN, US WHT defaults to 30% — file the form.
The biggest UK-specific tax optimization is the ISA wrapper: £20,000/year of US stock exposure can be wrapped where UK CGT and UK dividend tax disappear forever. The Bed & ISA workflow lets you sell RSUs (CGT event), transfer cash to ISA, repurchase US stocks — establishing a new cost basis inside a permanently UK-tax-free wrapper.
Start here — the complete guide
UK residents with US RSUs: complete tax + filing guide for 2026 →
3,000-word framework covering PAYE, NIC, CGT, US-UK DTC, SA106/SA108, ISA + SIPP wrappers, personal allowance taper.
Quick reference
Key tax rates, thresholds, and filing details for United Kingdom residents.
- Vest tax
- PAYE 20%/40%/45% + NIC 8%/2%
- PAYE via UK employer payroll
- CGT rate (basic)
- 18% post-30 Oct 2024
- CGT rate (higher/additional)
- 24% post-30 Oct 2024
- Annual exempt amount
- £3,000 (2024-25)
- US dividend WHT
- 15% with W-8BEN (US-UK DTC Article 10)
- Tax year
- 6 April - 5 April
- Filing
- Self Assessment (SA106 + SA108)
- ISA contribution limit
- £20,000/year (tax-free wrapper)
What happens at vest
Step-by-step walkthrough of the United Kingdom mechanics when your US RSUs vest.
- 1
Vest value = FMV × shares at vest date
USD value at closing price (or vest-eve reference price, plan-dependent).
- 2
Convert to GBP at HMRC-accepted rate
Spot rate on vest date OR HMRC monthly/yearly average. Bank of England daily reference rates are accepted. Choose one method, stick with it.
- 3
UK employer treats as employment income (section 471 ITEPA 2003)
The GBP value is added to your gross earnings for that pay period.
- 4
PAYE deducted at marginal rate
20% basic, 40% higher (over £50,270), 45% additional (over £125,140). Personal allowance taper between £100K and £125,140 creates a 60% effective marginal band.
- 5
NIC deducted
Employee Class 1 primary: 8% on £12,570-£50,270, 2% above. Employer NIC of 13.8% applies (paid by employer, but affects total comp positioning).
- 6
Net shares land in US broker account
After UK PAYE + NIC withheld (or sell-to-cover used to fund the UK liability). Cost basis for future CGT = FMV at vest in GBP.
- 7
Vest income appears on P60 + payslip
Confirm the value matches what your US broker reports. Mismatches indicate calculation errors that compound.
Filing calendar & deadlines
The key dates that matter for United Kingdom RSU holders.
| Event | Date | Form / consequence |
|---|---|---|
| UK tax year ends | 5 April | Cutoff for CGT annual exempt amount use |
| Paper Self Assessment deadline | 31 October (following year) | SA100 + SA106 + SA108£100 minimum penalty + interest |
| Online Self Assessment deadline | 31 January (following year) | SA100 + SA106 + SA108£100 minimum penalty + interest |
| First payment on account | 31 January | Required if previous year tax >£1,000 |
| Second payment on account | 31 July | Half of previous year's liability |
| ISA contribution deadline | 5 April (annual) | Unused £20K allowance lapses, no carry-forward |
Best brokers & platforms
The platforms worth knowing for United Kingdom residents holding US stocks.
Hargreaves Lansdown
Premier UK platform. 0.45% platform fee on stocks & shares ISA. Strongest customer service. Most expensive at scale but feature-complete.
AJ Bell
Strong middle ground. 0.25% platform fee capped at £42/year on shares. Good US stock access via stocks & shares ISA + SIPP.
Interactive Investor
£4.99/month flat fee, free regular investing for ETFs. Strong for portfolio sizes >£50K where percentage fees compound.
Trading 212
Zero platform fee, zero commission. Excellent for UK ISA wrapping. FX spread 0.15%. Best low-cost option for active US stock buyers.
Interactive Brokers UK
For non-ISA active investors. Lowest US stock commissions globally, best FX rates. No ISA support.
Common mistakes (and what they cost)
The errors United Kingdom RSU holders make most often.
Forgetting the ISA wrapper exists
£20K/year tax-free wrapper that eliminates UK CGT and UK dividend tax forever. Many UK RSU holders leave it unused and pay 24% CGT for years. Bed & ISA workflow makes wrapping painless.
Cost: £5K-£50K/year permanently lost vs wrapping
Missing W-8BEN filing → 30% US WHT instead of 15%
Without W-8BEN at your US broker, dividend WHT defaults to 30%. The treaty rate is 15%. The difference is non-recoverable.
Cost: 15% of all US dividends, permanently
Personal allowance taper at £100K caught by RSU timing
If your salary + RSU vest pushes total income across £100K, your personal allowance reduces £1 for every £2 — creating an effective 60% marginal rate on the £100K-£125K slice. Time vests if possible.
Cost: 20% extra tax on the affected band
Wrong GBP/USD rate for cost basis
Using sale-date rate for vest-date basis (or vice versa) inflates or deflates your computed gain. Document the HMRC rate used for each event.
Cost: Variable; can be material in volatile GBP years
Missing SA106 → HMRC compliance review
US dividend income must be reported on SA106 (foreign pages) with US WHT claimed as foreign tax credit. Failure to declare triggers audit risk + back-tax + interest.
Cost: Tax owed + interest + penalty up to 100% of evaded tax
Deep dives
2 live articles · 5 coming soon
- SIPP retirement wrapper for US stocks (coming soon)
- Personal allowance taper at £100K — RSU timing (coming soon)
- Cross-border vesting: moving US→UK (coming soon)
- SA106 foreign income walkthrough (coming soon)
- UK CGT 18%/24% computation guide (coming soon)
Frequently asked questions
How are US RSUs taxed for UK residents at vest?
FMV of vested shares is treated as employment income subject to UK income tax via PAYE (20%/40%/45%) and National Insurance Contributions (8% on £12,570-£50,270, 2% above). UK employer withholds. Cost basis for CGT = FMV at vest in GBP.
What is the UK CGT rate on US stock sales in 2026?
For sales on or after 30 October 2024: 18% basic rate / 24% higher/additional rate. Annual exempt amount £3,000 (2024-25). Cost basis converted at GBP/USD rate on vest date; proceeds at sale-date rate.
Can I hold US RSUs in a UK ISA?
Not directly — you can't transfer employer-issued RSU shares into ISA. But you can sell RSUs (taxable event) and reinvest cash in ISA. ISA contribution limit £20,000/year. Once in ISA, US stocks are UK-tax-free; US 15% WHT still applies to dividends but not creditable within ISA.
Should I prioritise ISA or SIPP for US stock exposure?
Depends on time horizon and marginal rate. SIPP gives marginal-rate tax relief on contributions; ISA gives zero relief but tax-free withdrawals at any age. For high earners (40%+), SIPP wins for retirement money, ISA wins for medium-term flexibility. Use both.
What's the deadline for UK Self Assessment with US RSU income?
31 January following the UK tax year end (online filing). For 2025-26 UK tax year (6 April 2025 - 5 April 2026), online Self Assessment is due 31 January 2027. Payment of any balance due on the same date.
Do I need to file Self Assessment if PAYE handled the vest tax?
Yes if you have additional income beyond PAYE — including US stock capital gains above the £3,000 annual exempt amount, US dividends, or self-employment. HMRC's online tool can tell you if you need to file. RSU sales typically trigger Self Assessment for high earners.
How does NIC apply differently to RSU vest vs salary?
Mechanically the same — Class 1 primary 8% on earnings £12,570-£50,270, 2% above. But because RSU vest typically pushes total earnings above £50,270, the marginal NIC on the vest is the lower 2% rate, not the higher 8% rate. This is regressive — high earners pay LESS NIC on vest income proportionally.
Related country hubs
Compare US RSU treatment across other major markets.
United States
US residents with US RSUs
Ordinary income at vest (W-2). Capital gains short-term (≤1 year) at ordinary rates, long-term at 0%/15%/20% + 3.8% NIIT. ESPP qualifying disposition saves materially in tax. Concentration risk is the biggest strategic issue.
Singapore
Singapore residents with US RSUs
IRAS taxes vest as employment income (0%-24% progressive). No capital gains tax — major advantage. US 30% dividend WHT (no DTC reduction). Foreign-sourced income exemption means Singapore doesn't tax US dividends received.
Germany
German residents with US RSUs
Lohnsteuer at vest (up to 47%+ with Soli + church tax). Abgeltungsteuer flat 26.4% on capital gains and dividends. US-Germany DTC reduces dividend WHT to 15%. Foreign capital income reported on Anlage KAP (German broker source-tax discharge doesn't apply).
Browse all country markets and RSU tax hubs.