What are the tax implications of RSUs from my previous employer after leaving the company in Germany?

Q: What are the tax implications of RSUs from my previous employer after leaving the company in Germany?

RSUs that vest after you leave a company can still trigger German tax if part of the work that earned them was performed in Germany. Learn when they're taxed, how sourcing works for mobile employees, and strategies to avoid double taxation.

It’s common for RSUs to keep vesting after you leave a company if your plan includes post-termination vesting (e.g., in a retirement, layoff, or garden-leave scenario). But for internationals in Germany, these “trailing” RSUs can create cross-border tax issues.

Germany may still tax some or all of the income if part of the work that earned the RSUs was done while you were in Germany, even if you live somewhere else when they vest.

Quick Answer

General rule: RSU benefits are taxed as employment income in Germany if they relate to work done in Germany, based on grant-to-vest workdays.
Timing: Tax point is vesting, not grant or sale (unless plan defers delivery).
Cross-border: If you worked in multiple countries between grant and vest, the benefit is split proportionally by workdays (sourcing allocation).
Double taxation: If two countries claim the same income, tax treaties decide who gets priority and whether you get a credit or exemption.

How RSU taxation works in Germany

Grant: No tax at grant.
Vesting: Taxable as salary income (geldwerter Vorteil) at the fair market value on the vest date (converted to EUR). This value is added to your payslip if the employer still processes payroll in Germany, or must be self-reported in your tax return if not.
Sale: Any difference between sale price and FMV at vest is capital gain/loss taxed at the flat capital income rate.

Post-employment RSUs : what changes?

The fact that you no longer work for the company doesn’t remove the German tax right over the portion of income linked to German workdays in the grant-to-vest period.

Example:

RSU grant date: 1 Jan 2023
Vest date: 1 Jan 2025 (2 years later)
You worked in Germany for 18 of the 24 months → 75% of benefit is German-sourced.
If you moved to the Netherlands for the last 6 months, Germany can tax 75% of the benefit; the Netherlands may also claim tax on the full benefit because you’re resident there at vest. The treaty then resolves double taxation.

Cross-border allocation in practice

Germany uses a workday-based allocation between grant and vest:

Count workdays in each country during the period.
Calculate percentage of total workdays in Germany.
Apply this percentage to the total benefit (shares × FMV at vest).
Report only that percentage as German-source income in your German tax return.
If you’re non-resident at vest, limited tax liability applies on the German portion.

Common scenarios

1. Remaining a German resident until vest

→ Full benefit taxed in Germany as salary. If another country also taxes it, you claim relief under the treaty.

2. Leaving Germany before vest

→ German tax only on the allocated portion of the benefit for workdays in Germany. The rest is taxed in your new country of residence.

3. Remote work periods

→ If you worked remotely in a third country during the grant-to-vest period, that country may also claim tax. This makes allocation records critical.

Practical example

1,000 RSUs granted on 1 Jan 2023.
Vest on 1 Jan 2026.
FMV at vest: €50.
Worked 400 out of 600 total workdays in Germany (≈ 67%).

Benefit value: 1,000 × €50 = €50,000.
German-source portion: €50,000 × 67% = €33,333.
Taxed as salary in Germany (plus solidarity surcharge, church tax if applicable).
The rest (€16,667) taxed where you lived for the other 200 workdays.

How to avoid double taxation

Know your treaty: Most German treaties follow the OECD model, allocating RSU income to where work was performed.
Time your move: If possible, move after vest to avoid complex allocation.
Keep records: Maintain a workday calendar and official employment records.
Use tax advisors in both countries: They can coordinate filings so credits/exemptions apply.

Common mistakes to avoid

Ignoring RSUs after leaving a job : they don’t disappear for tax purposes.
Assuming only the country of residence at vest can tax them.
Not keeping grant-to-vest workday records.
Forgetting about social security : in rare cases, cross-border rules can make part of the benefit subject.

German terms to know

Geldwerter Vorteil : taxable benefit in kind.
Lohnsteuer : wage tax.
Solidaritätszuschlag : solidarity surcharge.
Doppelbesteuerungsabkommen (DBA) : double taxation agreement.

Checklist

Identify grant & vest dates for each RSU tranche.
Count workdays in Germany during that period.
Get FMV at vest in EUR.
Check treaty rules for your destination country.
Plan filing in both countries if needed.

Disclaimer

⚠️ IMPORTANT LEGAL DISCLAIMER:

This content is for educational and informational purposes only and does not constitute financial, tax, legal, or investment advice. You should not rely on this information as a substitute for, nor does it replace, professional financial or tax advice. Always consult with qualified professionals (tax advisors, financial planners, lawyers) before making any financial decisions or taking any actions based on this information.

Disclaimer: This is general information and may differ for individual cases. Learn more about financial planning with Financemate in a discovery call. Actual tax liability depends on treaty terms, plan design, and your mobility history. Seek professional advice for your specific case.