Should I Sell My RSUs When They Vest?
Every few days someone asks me a version of this. They feel disloyal selling, or they're sure their company is about to take off, or they just haven't thought about it as a decision at all.
So let me give you the honest answer, then the maths, then the exceptions.
The default answer: yes, sell and diversify
For most tech employees in Ireland, selling your RSUs on the day they vest and reinvesting into a diversified global index fund is the cleaner choice.
The reason is simple once you see it. Your RSUs were already taxed as income at vesting. The money is already yours, already taxed. Holding the shares is not "letting my investment grow." It is making a brand-new decision to put that money into a single stock, the stock of the same company that already pays your salary, your bonus and your pension.
Think of it like this. If your employer handed you the cash equivalent instead of shares, would you take that cash and buy only your own company's stock with all of it? Almost nobody would. Holding vested RSUs is exactly that decision, just hidden by inertia.
The maths, in your favour
There is no tax penalty for selling immediately. You've already paid the income tax. If you sell the day they vest, there's usually little or no gain yet, so little or no Capital Gains Tax.
Hold, and two things can happen. The shares can fall, and now you've lost real money on an over-concentrated bet. Or the shares can rise, and you owe 33% CGT on the gain when you finally sell anyway.
I looked at this across the companies my own clients work for. Of 25 public companies, only 9 beat the S&P 500 over a five-year window. Sixteen lost to a plain index fund. The biggest winner was a company I'd never heard of. I worked in tech for eighteen years and I still couldn't have picked it. Neither can you, and that's not an insult, it's the whole point.
When holding can make sense
I'm not religious about this. A few situations where holding, or selling more slowly, can be reasonable:
- A genuine qualifying scheme. Some specific Revenue-approved share schemes carry tax advantages for holding. RSUs and standard ESPPs usually don't, but check what you actually have.
- A blackout or trading window. You may be restricted from selling on the exact vest day. Sell at the first window you can.
- A near-term sale would tip you into a worse tax position elsewhere. Rare, but worth a quick check if the numbers are large.
- You've already diversified. If your company stock is a small slice of a well-spread portfolio, the urgency drops. The danger is concentration, not ownership itself.
Notice what's not on the list: "I have a good feeling about the stock." That's the one that cost me years of unnecessary risk.
What I do
I sell on the day they vest and reinvest into a fund that owns the whole market. Every time. I'd rather own a little of everything than bet my freedom on the company I happen to work for.
The full strategy, with the pension step that should come first, is in the main guide: RSU & ESPP tax in Ireland: the complete guide.
This is general information, not personal advice
Your situation is yours. These are the principles and my own approach, not a recommendation for your specific case.
I'm Sjoerd Bak, a qualified financial adviser. No products, no commission. I help tech professionals in Ireland turn a strong salary into real financial freedom.
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Frequently asked questions
Is there a tax penalty for selling RSUs immediately in Ireland?
No. The income tax is already paid at vesting. If you sell straight away there is usually little or no gain, so little or no Capital Gains Tax. Selling early is generally the tax-clean choice.
Why do advisers suggest selling RSUs at vest?
Because the money is already taxed and holding leaves you over-exposed to a single company that also pays your income. Selling and diversifying spreads the risk.
What should I do with the money after selling my RSUs?
A common approach is to max your pension first for the tax relief, then reinvest the rest into a low-cost, diversified global index fund.
Is it ever smart to hold RSUs?
Sometimes, for example if your company stock is already a small part of a diversified portfolio, or if a specific approved scheme gives a tax advantage for holding. A gut feeling about the share price is not a good reason.