When is an RSU vest taxed?

On the vest date, at the market value of the shares that day. It is employment income and goes through PAYE like salary, subject to income tax and employee National Insurance. It counts towards the tax year the vest date falls in, regardless of when you sell the shares.

Does selling shares to cover the tax reduce my income?

No. Sell-to-cover changes how the tax bill is settled, not how much income you had. The full market value at vest is your employment income either way. Selling some shares to fund the PAYE deduction is a disposal of shares you already owned for tax purposes.

My salary is under £100,000. Can a vest still take me over?

Yes, and that is the most common way people cross the line. Adjusted net income adds vests, bonus and other taxable income to your salary. A base salary well under the threshold plus a single vest can push the total over it, which withdraws part of your personal allowance and ends childcare eligibility.

What if my vest falls in a different tax year?

The UK tax year runs from 6 April 2026 to 5 April 2027. A vest dated on either of those days is inside the year; a vest the day before the start or the day after the end belongs to a different year. Vesting schedules rarely respect that boundary, so a quarterly schedule can put three vests in one tax year and five in another.

Does capital gains tax come into it?

Not at vest. If you keep the shares and sell them later, any change in value between the vest date and the sale is a capital gain or loss, handled separately. This calculator covers the income tax position at vest only and does not model later disposals.

2026/27 tax year · England, Wales and Northern Ireland

When an RSU vest pushes you over £100,000

A vest is employment income on the day it lands, whether or not you sell a single share. That is what makes vesting schedules the most common way a PAYE employee crosses the £100,000 line without a pay rise.

A vest is income on the vest date

Restricted stock units are a promise of shares at a future date. Nothing is taxed while they are unvested. On the vest date the shares become yours, and at that moment their market value becomes employment income. Your employer runs it through PAYE exactly as it would a bonus: income tax at your marginal rate and employee National Insurance are deducted, and the figure appears on your payslip and your P60.

The number that matters is the market value on the vest date, not the price when the grant was made and not the price when you eventually sell. If 1,000 shares vest at £15 each, £15,000 of employment income has arrived, and that £15,000 counts in full towards your adjusted net income for the year.

Sell-to-cover does not reduce the income

Most vesting arrangements sell a portion of the shares automatically to fund the PAYE deduction. This is the single biggest source of confusion, because people see a smaller number of shares arrive in their account and reason that only the net amount was income.

It was not. The whole vest was income; some of the resulting shares were then sold to settle the tax on it. The mechanics are the same as receiving a £15,000 bonus and having £6,000 of tax deducted at source: your income for the year was £15,000, not £9,000. Adjusted net income uses the gross figure, so a vest of £15,000 moves you £15,000 closer to the threshold no matter how the tax was settled.

Which tax year does a vest belong to?

The UK tax year runs from 6 April 2026 to 5 April 2027. A vest belongs to whichever year contains its vest date, and the boundary is unforgiving: a vest on the fifth of April is in the previous tax year, a vest on the sixth is in this one.

Vesting schedules are set by grant date and cliff, not by the UK tax calendar, so it is common to find an uneven split. A quarterly schedule that began in February will put a vest in early April every year, which lands on one side of the line or the other depending on the exact date. If you have several grants running at once, the total falling in a single tax year can be considerably larger than the annual average suggests.

The calculator below takes each vest with its date and counts only the ones inside the tax year. Vests outside it are listed separately in the working, so you can see what was excluded and why.

What crossing the line actually costs

Take a salary of £95,000 and a single vest of £15,000, with no pension contributions or Gift Aid. Adjusted net income is £110,000. That is £10,000 over the threshold, so £5,000 of personal allowance is withdrawn, leaving £7,570 rather than £12,570. Income tax on the year is £33,432.

Had the same person stopped at exactly £100,000, income tax would have been £27,432. The extra £10,000 of income therefore cost £6,000 in tax: an effective marginal rate of 60%. Employee National Insurance at 2% above the upper earnings limit takes it to 62%. The explanation of the 60% band sets out where that rate comes from.

If there are children in childcare, the same crossing also ends Tax-Free Childcare and the 30 funded hours, which is a separate and often larger loss. That is covered in bonuses and childcare eligibility.

Add your vests and see where you land

Figures update as you type. There is nothing to submit.

Your figures never leave your browser. Payslips are read on your device — not uploaded, not sent to an AI. The calculation runs here too. Nothing you type is stored, logged, or passed to analytics.

Where do you pay income tax?

Scottish income tax rates and bands differ and are not covered by this tool.

England, Wales or Northern IrelandScotland

How do you want to enter your pay?

Drop a payslip to fill year-to-date figures, or enter amounts yourself below. The rest of the calculator appears once you confirm.

Use figures from a payslip

Drop a file below, check the figures, then apply. Or type year-to-date totals by hand.

Drop a payslip or P60 here

or click to choose a file

PDF preferred; a clear photo works too. Read on your device only — never uploaded. One month’s slip is enough to project the year and check the £100,000 line.

Figures are extracted in your browser (text layer or on-device OCR). The file is never sent to us, never passed to an AI provider, and is gone when you close this tab.

Choose how to enter your pay above to see your figures.

Enter figures yourself, or drop a payslip. The rest of the form appears once you confirm.

The pension arithmetic

Adjusted net income is reduced by pension contributions, and the calculator shows the gross contribution that would bring the figure back to £100,000. In the example above that is £10,000.

The mechanism matters. Under salary sacrifice or a net pay arrangement, £10,000 is the amount deducted from pay. Under relief at source, £10,000 is the gross figure, which corresponds to £8,000 leaving your bank account with the scheme reclaiming the rest. The calculator labels which is which, because quoting the wrong one by 20% is an easy mistake to make.

Whether any of that is sensible depends on your annual allowance, your age, when you need the money, and your wider position. Those are questions for a qualified adviser or an accountant, not for a calculator.

What this tool does not model

Capital gains on later disposal. If you hold the shares after vest, any subsequent movement in price is a separate capital gains question.
Share price changes between now and the vest. Enter your best estimate of the market value at vest. If the price moves, the income moves with it.
Scottish income tax. Scotland sets its own rates and bands, which are not covered here.
Employer arrangements that vary the treatment, such as certain internationally mobile employees or shares acquired under a tax-advantaged scheme.

Checking your own figures

Your vest statements or share plan portal will show the vest date and the value at vest for each tranche. Your payslip for the month of a vest should show the value added to gross pay, with the PAYE deducted alongside it. Comparing the two is the quickest way to confirm what has actually been reported.

Where the numbers matter, check them against HMRC guidance on tax on employee share schemes and speak to an accountant. The figures here are estimates produced from what you typed in.