If you're an Indian tech employee with unvested or vested RSUs from a foreign employer and a move-back date on the calendar, you're really juggling three timelines that don't sync automatically: your vesting schedule, your broker's willingness to keep serving you once you're no longer a US resident, and India's foreign-asset reporting calendar.
Missing any one of them costs you real money or creates a compliance problem later.
This is a sequential checklist to work through before, during, and after the move.
Table of contents
Before you move
Line up your relocation date against your vesting calendar
Pull up every remaining vest date for the next 12 to 24 months and mark which ones fall before your move and which fall after. This matters because what happens to unvested RSUs depends on whether you're leaving your employer or staying with it.
- If you're resigning: most plans forfeit unvested RSUs on resignation. Some plans do offer accelerated vesting as part of an exit negotiation, particularly for senior employees, but that's a negotiated exception, not a default.
- If you're staying with the same employer (an internal transfer, or continuing remotely): your unvested RSUs keep vesting on schedule. But if a vest lands after you've moved, the income can straddle two countries. When vesting income covers a period you worked partly in the US and partly in India, India and the US apportion that income based on the number of workdays each country during the vesting period. RSU income that vests after you've returned, but that was earned for work performed in the US, is still classified as US-source income for that portion.
Know that the US doesn't care where you live when a vest hits
RSU vesting income is reported on your W-2 and subject to US income tax withholding, regardless of where you live at the time of vesting. Your employer will withhold in the US even if you've already relocated.
Your cost basis for the shares becomes the fair market value on the vesting date, and for capital gains purposes the holding period for foreign company RSU shares is counted from the vesting date to the sale date, under Section 2 of the Income-tax Act, 2025.
Check whether your broker will still keep you as a client
Once you move, you become a 'Non-Resident Alien' (NRA) in the eyes of the US tax system, and many US brokers do not support NRA accounts. Many US brokers close accounts outright once the holder becomes a non-US resident. Specifically:
- Robinhood, Webull, and M1 Finance do not support non-US residents at all. If these platforms detect a foreign IP address or an address update to India, they may restrict the account or force liquidation of positions immediately.
- Schwab, Fidelity, and E*TRADE are more flexible and usually let you convert to an International account. But an International account can also mean several restrictions.
Call your broker before you move, not after. Find out now whether your account converts automatically, gets frozen, or gets force-liquidated.
Decide how you'll move your vested shares, and don't default to selling
Selling triggers a taxable event. The alternative is an in-kind transfer. For a standard brokerage account, ACATS (Automated Customer Account Transfer Service) lets you move your entire portfolio to a new broker without selling. Moving shares between brokers via ACATS is a custody change, not a sale, so there's nothing to tax; your original purchase date and price carry over and the capital gains clock continues from where it left off.
If your vested RSUs sit in an employer stock plan account (rather than a regular brokerage account), that account usually moves through a DTC Free of Payment transfer instead of ACATS, because stock plan accounts don't always participate in ACATS the same way.
Vested RSUs are your shares and can be transferred this way; unvested RSUs cannot be transferred and stay with the employer's stock plan provider until they vest. Like ACATS, a DTC Free of Payment transfer is an in-kind transfer with no taxable event.
Work out which Indian residency status you'll land in, and when
This decides your entire tax and reporting posture, so don't skip it. Under the Income-tax Act, you're a Resident of India for a financial year if you're in India for 182 days or more during that year, or if you're in India for 60 days or more during the year and 365 days or more in aggregate across the preceding 4 years. If you don't meet either test, you're a Non-Resident.
If you do become a Resident, you're next classified as either an RNOR (Resident but Not Ordinarily Resident) or an ROR (Resident and Ordinarily Resident), and this is where most returning employees get it wrong by assuming 'resident' automatically means full Indian tax on everything. You qualify as RNOR under either of two tests:
- You were a Non-Resident in India in at least 9 of the preceding 10 financial years.
- You were physically present in India for 729 days or less in total during the preceding 7 financial years.
Most returning NRIs will meet at least one of these and get 1 to 3 years of RNOR status before becoming a full ROR.
During RNOR, your foreign income is tax-free in India as long as it's received outside India first. This matters directly for your foreign RSUs and any US brokerage holdings.
Review your employer-stock concentration while the tax math is still in your favor
There's no fixed rule for how much company stock is 'too much,' and if that's a live question for you, it deserves its own review (see our concentration risk guide). What the timeline checklist should flag is that the window to trim a concentrated position at close to zero tax cost is wide open right now and narrows the moment you become an Indian tax resident:
- As a non-resident alien, you pay 0% US tax on capital gains from selling stock.
- If you sell global stocks or ETFs while you hold RNOR status, the capital gains are tax-free in India too. Some returning employees use this RNOR window deliberately to reset their cost basis on appreciated positions without paying tax on the gain.
During the transition
Know that FEMA residency starts the moment you land, not on a tax-year date
This is a separate clock from your income-tax residency, and it trips people up. You become a resident under FEMA immediately upon landing in India, if your intention is to stay for an uncertain period or for employment or business. Unlike tax residency, which counts days across the year, FEMA residency applies the moment you return to settle.
You can still keep and operate a foreign bank account, foreign stocks, or foreign property that you acquired while you were a resident outside India, under Section 6(4) of FEMA, and you are not legally required to close any of it.
Decide what to do with any NRO account
If you held an NRO account as an NRI, note that once your status changes to Resident, you're legally required to inform your bank and convert it to a standard Resident Savings Account. Continuing to hold an NRO account as a resident is a FEMA violation. Put this on your calendar for right after you land, since it's easy to forget in the middle of a move.
Start a folder for every document Schedule FA will eventually need
Even if you're NR or RNOR right now and don't owe a Schedule FA filing yet (more on that below), start collecting the paperwork immediately, because the records get harder to reconstruct the further back you have to reach. You'll want:
- RSU vesting statements, which show when your RSUs vested, how many shares you received, and their fair market value on the vesting date.
- Brokerage account statements, which show your holdings, purchases and sales, dividends, and account balances.
- Employer equity plan reports, which typically summarize your RSU grants, vesting history, and tax withholding.
Together, these are what you'll use to calculate the correct values and support your disclosure.
After you're settled
Know exactly when Schedule FA becomes mandatory for you
This is the single most misunderstood part of a return-to-India move, and it's worth stating plainly: you are required to file Schedule FA only if you qualify as Resident and Ordinarily Resident (ROR) for the relevant financial year. If you're a Non-Resident or an RNOR, you are not required to report foreign assets in Schedule FA, even if you hold foreign RSUs or shares.
So the sequence is: land in India, work out your residency status for that year using the tests above, and only worry about Schedule FA once you've actually crossed into ROR, which typically happens 2 to 3 years after your return for most people who qualify for RNOR first.
Don't assume a small holding is exempt from disclosure, but check whether the penalty threshold applies to you
Once you are filing Schedule FA, the disclosure obligation itself has no minimum value threshold: it does not matter if a foreign asset is small, dormant, or generating zero income, disclosure is mandatory regardless of size.
Even a holding that shows as 'zero' right now still has to be disclosed if you owned it for even a single moment during the reporting period. The rule of thumb is simple: if it has financial value and sits outside India, it goes on Schedule FA. It doesn't matter whether you've sold the shares, whether their value went up or down, or whether you received any dividends.
The penalty side is where there's more nuance than a flat number suggests. Under Section 43 of the Black Money Act, failing to disclose foreign assets (or furnishing inaccurate particulars) in your ITR can attract a penalty of ₹10 lakh for that year. This is a per-year penalty tied to the return, not a per-asset penalty that stacks with the number of undisclosed holdings.
There's also an exemption worth knowing: as amended by the Finance (No. 2) Act 2024, this penalty does not apply to undisclosed foreign assets other than immovable property if their aggregate value doesn't exceed ₹20 lakh at any point during the financial year. That exemption is about penalty exposure, not the disclosure obligation itself, which still has no minimum. In practice this means a small, genuinely forgotten holding may not trigger the ₹10 lakh penalty even if it should still have been disclosed, but you shouldn't rely on that threshold as a reason to skip disclosure.
Track the 24-month holding clock separately for every vesting lot
Once you start selling shares as a resident, this is the other rule worth stating outright: shares held up to 24 months from the vest date are classified as short-term capital gains and taxed at your income slab rate; shares held more than 24 months from the vest date are classified as long-term capital gains and taxed at a flat 12.5%, without indexation.
This clock runs from each individual vest date, not from your move date or a single grant date. Each vesting event creates its own lot with its own 24-month clock, and lots can't be combined into a single calculation when you sell.
Whether there's a distinct US estate or gift tax consequence specific to moving RSU shares in-kind via an ACATS or DTC transfer, as opposed to a straightforward sale, is worth a direct check with a tax advisor if your holdings are large.
