RSU tax India US stocks questions come down to one fact: there are two independent taxable events. Vesting is a perquisite taxed as salary at slab rates (TDS under Section 192), and sale is taxed as capital gains under Section 112. Perquisite tax paid at vesting cannot be set off against the capital-gains liability at sale — and when you move from the US to India mid-vest, the overlap between US-sourced vesting income and India's worldwide taxation is where RSU double tax arises.
Event 1: vesting is salary
Vesting is a perquisite taxed as salary at slab rates (TDS under Section 192); with no exercise price the full fair market value on vesting is taxable, converted to INR at the SBI TT buying rate for that date. That INR value also becomes your cost base for the later sale.
Event 2: sale is capital gains
Sale is taxed as capital gains under Section 112 on the INR sale value minus the INR cost base fixed at vesting. US-listed shares are treated as unlisted foreign securities, so they are long-term only if held 24 months or more from vesting. LTCG is taxed at 12.5% without indexation (Finance (No.2) Act 2024, effective 23 July 2024); the Section 112A ₹1.25 lakh exemption does not apply to foreign shares; short-term gains (under 24 months) are taxed at slab rates. For the full rate table see NRI income tax rates.
RSU double tax: where the US and India overlap
The vesting perquisite attributable to services rendered in the US during the grant-to-vest period is US-sourced, while India brings worldwide income to tax once you are ROR. That overlap is where double tax arises and where foreign tax credit matters; apportionment is fact-specific. Your residential status in the vesting year matters, so check the Section 6 guide and RNOR planning.
Foreign tax credit RSU India: what is creditable
Only US federal income tax is creditable under the India-US DTAA — US state tax and US Social Security/Medicare (FICA) are not creditable. The credit is claimed via Form 67 under Rule 128, filed on or before the ITR; Rule 128(9) allows filing up to the end of the assessment year if the ITR was timely. Form references are being renumbered under the Income-tax Act, 2025 (effective AY 2027-28); for FY 2025-26 returns Form 67 applies. More on treaty mechanics in the India-US DTAA guide.
Schedule FA RSU disclosure
A Resident and Ordinarily Resident must disclose foreign assets — vested RSUs, the US brokerage account and beneficial interests — in Schedule FA, which uses the calendar year, not the financial year. Non-disclosure attracts penalties under the Black Money Act, 2015. RNOR and NR individuals are not required to file Schedule FA. See the Schedule FA and FATCA guide.
Where to go next
Read the RSU, ESOP and retirement-fund hub, the USA corridor hub and the H-1B returnee hub, and keep vesting confirmations, US withholding records and SBI TT rates for each vest date.
This is general information, not advice — confirm against your facts with a qualified professional. To map your own position, start with a scoped cross-border review or book a free 15-minute NRI Tax Discovery Call; fees are confirmed in a written scope after the call.