Restricted Stock Units in Ireland 2025

In today’s tech-driven economy, more and more Irish employees are being rewarded with Restricted Stock Units (RSUs). They’re a fantastic way to share in your employer’s growth, but they also bring serious tax complications.

Employees often assume RSUs are “free shares.” In reality, RSUs trigger income tax, USC, PRSI, and potentially Capital Gains Tax (CGT) at different stages. If you’ve moved countries, changed residency, or are non-domiciled in Ireland, things get even more complicated.

At Irish Tax Hub, we specialise in helping employees, directors, and international assignees navigate RSU taxation in Ireland. We’ve seen every type of edge case - from cross-border vesting to double taxation issues - and we know how to optimise your outcome.

What Are RSUs?

Restricted Stock Units are a type of deferred compensation. Instead of cash, your employer grants you units that convert into shares (or cash equivalent) once conditions are met.

• Grant Date: You’re promised RSUs but no tax event yet.
• Vesting Date: RSUs convert to actual shares or cash → tax event.
• Sale Date: If you sell shares, CGT may apply on any gain.

This three-stage lifecycle is where tax complexity arises.

When Are RSUs Taxed in Ireland?

RSUs are taxable at vesting if you are resident in Ireland. Revenue treats the value of RSUs at vest as income, just like salary. That means:

• Income Tax (20% or 40% depending on band).
• Universal Social Charge (USC) (up to 8%).
• PRSI (usually 4.1%).

That’s often over 50% tax on the vest value.

Then, if you later sell the shares at a higher price, you pay 33% CGT on the difference between the vesting value (your “base cost”) and sale proceeds.

How Employers Handle RSU Tax

Most companies apply a sell-to-cover mechanism: they sell part of your vested shares to cover the tax liability and remit it via payroll. Typically, around 52% of vested shares disappear instantly to satisfy PAYE, USC, and PRSI.

But employers don’t track CGT liabilities for you - that’s your responsibility. This is where many employees slip up, because CGT must be:

• Self-reported and paid by 15 December for gains realised between Jan–Nov.
• Self-reported and paid by 31 January for gains in December.

At Irish Tax Hub, we help clients avoid late CGT penalties by handling reporting and payment deadlines correctly.

Worked Example: Standard RSU Vest

Claire works at a Dublin tech firm:

• 600 RSUs vest on 1 July 2025, market value €70 per share = €42,000.
• Income Tax (40%): €16,800
• USC (8%): €3,360
• PRSI (4.1%): €1,722
• Total tax = €21,882, withheld via payroll.

She keeps the remaining shares. In December, she sells them at €75 per share, realising €3,000 profit.

• CGT (33%) = €990, payable by 31 January 2026.

Claire’s employer handles PAYE, but only Irish Tax Hub ensures her CGT is declared, reliefs applied, and everything reported on her Form 11.

Scenario Analysis: Where It Gets Complicated

1. Cross-Border Vesting

Many employees earn RSUs while working abroad, then move to Ireland before vesting. Key issue: Ireland taxes RSUs only if you’re resident when they vest. There is no pro-rata split based on where you worked.

• Example: You work in the UK for 18 months, then relocate to Dublin. RSUs vest after 2 years. Ireland will tax the full value at vest, even though most of the work was abroad. The UK may also tax - creating a double taxation risk.

Irish Tax Hub Tip: We apply Double Taxation Agreements (DTAs) to claim credits and eliminate double tax exposure.

2. RSUs Paid in Cash vs Shares

• Cash-settled RSUs: Treated purely as employment income - no CGT later.
• Share-settled RSUs: Employment income at vesting, then potential CGT at sale.

Mixing both creates hybrid reporting. Employers don’t always explain this clearly, but Irish Tax Hub ensures correct treatment on your Form 11 or Form 12.

3. Departure from Ireland

If you leave Ireland mid-year and RSUs vest after you’ve left, Ireland won’t tax them. But your new country may tax the full value.

This can leave you struggling to get foreign tax credits. Our team at Irish Tax Hub coordinates multi-country RSU tax reporting to avoid costly overlaps.

Common Pitfalls with RSUs in Ireland

• Assuming the employer handles all taxes (they don’t handle CGT).
• Forgetting the CGT deadlines (15 December and 31 January).
• Mixing RSU shares with other investments and losing track of base costs.
• Overpaying tax by not claiming treaty credits.
• Triggering unexpected liabilities when moving abroad.

FAQs

Do I pay tax when RSUs are granted?
No. Only when they vest.

Can I claim deductions against RSU income?
Generally no, though certain professional expense claims may apply.

What if my employer is US-based?
RSUs are still taxable in Ireland at vest if you are resident. You may also have US reporting obligations.

Can RSUs be taxed twice?
Yes - if another country claims tax too. But Irish Tax Hub applies DTAs to resolve double taxation.

Why Choose Irish Tax Hub for RSUs?

• We know RSUs inside out: tech, pharma, financial services - we’ve seen every scheme.
• We integrate PAYE and CGT: no missed filings, no late penalties.
• We optimise residency and domicile: minimising exposure under Irish rules.
• We navigate DTAs: saving clients thousands in avoided double tax.
• We provide peace of mind: Revenue queries are handled with expertise and confidence.

Clients who came to us fearing they owed 52% tax often walk away with significant tax credits, reliefs, and refunds they didn’t know existed.

Final Thoughts

RSUs are one of the most valuable but misunderstood forms of compensation in Ireland. They can dramatically increase your wealth - but also your tax bill if not handled properly.

Whether you’re a tech employee, an expat executive, or a non-domiciled professional, you need more than payroll withholding. You need a tax strategy that protects your wealth and ensures full compliance.

That’s what Irish Tax Hub delivers.

👉 Contact Irish Tax Hub today for a personalised RSU consultation. We’ll map your vesting schedule, align it with your residency, and help you keep more of your hard-earned shares.