Which ITR Should I File for RSU Income?
RSUs can create employment income and may create capital gains when shares are sold. The correct ITR depends on the complete income profile. For an individual without business/professional income who cannot use ITR-1, ITR-2 is generally considered.
Quick Answer
In practical terms, RSUs can create employment income and may create capital gains when shares are sold. The correct ITR depends on the complete income profile. For an individual without business/professional income who cannot use ITR-1, ITR-2 is generally considered.
Who can use the simpler ITR forms?
ITR selection depends on the nature of income and the exclusions in each form. ITR-2 is designed for individuals/HUFs without business/professional income and can accommodate capital gains.
What to check before choosing the ITR
If you also have business/professional income, ITR-3 may be required. Foreign-company RSUs can also create foreign-asset or foreign-income reporting considerations depending on the facts.
When another ITR may be required
Reconcile employer records, vesting/exercise records, broker statements and any foreign-asset information before filing.
Practical filing tip
For RSUs, consider both the tax treatment when shares vest and any capital gain or loss when shares are sold. Select the ITR after considering the complete income profile and required disclosures.
