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Your employer stock is a wealth-building asset \u2014 but without a plan, it's a concentration risk. We help tech professionals navigate taxation, FEMA compliance, and smart diversification strategies.
Consider Arjun, a software engineer with a CTC of \u20B950 lakh. \u20B95 lakh comes as RSUs. Over five years, due to stock price growth, his RSU holdings have grown to \u20B92.5 crore.
About 50% of Arjun's entire net worth sits in one stock. While he's bullish on the company, the concentration risk is real. This is the exact situation many senior tech professionals in India face today.
Too much employer stock means both salary and wealth depend on the same company.
US imposes up to 40% estate tax on assets above USD 60,000 held by non-US persons.
Foreign shares, RSUs, and overseas brokerage accounts must be reported annually. Non-reporting is a major compliance risk.
Understanding the two-stage taxation is critical for optimal planning.
No selling required; no immediate tax; keeps funds in USD; access to wider platforms like IBKR
Limited investment choices; Schedule FA reporting continues; no estate tax mitigation.
Wider options to diversify; enables immediate global diversification through foreign ETFs/UCITs
Triggers immediate tax on capital gains; works only if both brokers support ACATS/DTC.
Tax-efficient structure; fund-level taxation; no Schedule FA hassle on GIFT City units
Tax applies on sale of RSUs; requires GIFT City onboarding process.
As per FEMA guidelines, if a resident Indian sells RSUs and keeps the USD proceeds with a foreign broker, the funds must be repatriated back to India within 180 days, unless they are reinvested abroad.
The same 180-day rule applies when USD proceeds are moved to another foreign broker or routed through a GIFT City account. Investors must ensure timely reinvestment or repatriation to stay compliant.
GIFT City funds are taxed at the fund level, not the investor level. When you redeem, there is no additional capital gains tax \u2014 making them highly tax-efficient for RSU diversification.
| Fund | Strategy | Min. Ticket |
|---|---|---|
| Ionic | Focus on mid-tier IT companies | HNI |
| Mirae | Invests in ETFs across global markets | HNI |
| Baroda BNP | US Small Cap Fund, bottom-up approach | HNI |
| DSP | Value stocks, market-cap & country agnostic | $5,000 |
| PPFAS Nasdaq | Nasdaq 100 linked UCITS & ETFs | $5,000 |
| PPFAS S&P | S&P 500 linked UCITS & ETFs | $5,000 |
| Fund | Strategy |
|---|---|
| Phillip Capital | Invests in US-listed ETFs, sector agnostic |
| Marcellus | Bottom-up, 25-30 stocks across market caps |
| PPFAS | Value investing, sector 25% cap, single stock 10% cap |
Using Arjun's example: 500 shares allotted on 15 Jan 2025, FMV $85/share, 100 sold during CY 2025.
| Item | Held Shares (400) | Sold Shares (100) |
|---|---|---|
| Initial Value | 400 \u00d7 $85 \u00d7 \u20B990 = \u20B930,60,000 | 100 \u00d7 $85 \u00d7 \u20B990 = \u20B97,65,000 |
| Peak Value (CY 2025) | \u20B930,60,000 | Nil (sold) |
| Closing Value | 400 shares | Nil |
| Sale Proceeds | \u2014 | \u20B97,65,000 |
Key Notes:
RSUs (Restricted Stock Units) are company shares granted to employees that vest over time — you don't pay anything to acquire them. ESOPs (Employee Stock Option Plans) give you the option to buy shares at a pre-determined price. RSUs have value from day one; ESOPs have value only if the stock price exceeds the exercise price.
RSUs are taxed at two points: first as a salary perquisite when they vest (based on FMV on vesting date), and again as capital gains when you sell. LTCG applies if held over 12 months from vesting; otherwise STCG at your slab rate.
As per FEMA guidelines, if a resident Indian sells RSUs and keeps the USD proceeds with a foreign broker, the funds must be repatriated to India within 180 days — unless they are reinvested abroad (e.g., moved to another foreign broker or routed through a GIFT City account).
Yes. Foreign shares, including unsold RSUs, must be declared in Schedule FA of your ITR every year until they are sold. Non-reporting is a significant compliance risk.
GIFT City funds are taxed at the fund level, not the investor level. When you redeem, there is no additional capital gains tax. This makes them a tax-efficient way to diversify RSU proceeds into global markets while staying compliant with Indian regulations.
Yes. We provide end-to-end RSU advisory — from understanding your vesting schedule and tax implications to building a diversified portfolio through GIFT City funds, global ETFs, and domestic alternatives. We work alongside your CA for complete compliance.
Diversify RSU proceeds via LRS, GIFT City funds and US-stock platforms with full FEMA support.
Learn more →Holding RSUs while working abroad? FEMA-compliant India + global guidance.
Learn more →Build the Indian leg of a diversified portfolio alongside your employer equity.
Learn more →