UK-to-US Equity Transfers at Tech Companies

A product manager in the London office of a US-headquartered tech company transfers to the San Francisco headquarters. She has been with the company for three years, has vested 20,000 SAYE options at a £10 strike (stock now £85), and has 40,000 unvested RSUs. The transfer is permanent, on an L-1B visa initially.

Three distinct questions arise:

What happens to the SAYE options if she exercises after relocating?
How are the unvested RSUs taxed if they vest after her US arrival?
Does she file 83(b) on any new US-side grants, and does the UK’s residency concept affect anything?

The answers depend on her UK tax residency status during the move year, the specific terms of each plan, and the US-UK treaty. The most common mistake is treating the UK treatment and US treatment independently rather than as a coordinated exercise.

SAYE (Save As You Earn) option plans

SAYE is a UK-statutory approved savings-related share option scheme under ITEPA 2003. Employees save £5 to £500 per month for 3 or 5 years; at maturity, they can use savings to exercise options at a strike price set at grant (up to 20% discount to the start-of-period FMV).

UK tax treatment:

No UK income tax at exercise if the employee has been continuously employed throughout.
Capital gains tax only on sale, based on gain over strike price.

US tax treatment for a UK-to-US transferee:

On the day of US tax residency start, the US looks at the spread between FMV and strike.
US does not recognize SAYE’s UK tax-advantaged status.
Exercise after becoming US resident is treated under IRC §83 as compensation income on the spread.

Mechanics:

Exercise before US residency starts: UK-only event. SAYE rules apply; no US tax.
Exercise after US residency starts: US §83 compensation income on the spread (FMV at exercise minus strike). Sourcing is split based on work periods during the grant-to-exercise period.
Hold and sell after residency: capital gain or loss on subsequent appreciation, US rules apply for the US portion.

Planning tip: if practical, exercise SAYE before US residency starts to lock in UK-favorable treatment. The UK employee receives the SAYE benefit fully; the US sees only the post-exercise capital gain clock.

EMI options (Enterprise Management Incentives)

EMI is a UK statutory scheme for smaller companies (gross assets under £30M at grant, under 250 employees). Options granted under EMI have favorable UK tax treatment: no UK income tax at grant or exercise if the strike is at or above grant-date FMV, and CGT on eventual sale with entrepreneur’s relief (now Business Asset Disposal Relief) potentially available.

US treatment on transfer:

If the grant was within EMI rules and the strike was at or above grant-date FMV, the US generally treats the option the same as an NSO (no income at grant if strike ≥ FMV).
Exercise after US residency: §83 compensation income on the spread at exercise.
The UK EMI designation does not transfer to US tax law; US treats as ordinary NSO.

For an EMI option with a £1 strike and £50 FMV at the time of US transfer, exercising after transfer produces $49 per share of US compensation income (converted to USD). UK would tax the CGT at sale (no income at exercise under EMI). The US taxes income at exercise; the UK potentially taxes CGT at sale. Sourcing allocates between countries based on vesting-period workdays.

Unvested RSUs at transfer

RSUs granted in the UK with global vesting that continues through the US transfer:

UK treatment for pre-transfer vesting period: UK source, UK taxed at vest (potentially with employer’s PAYE and NICs).
US treatment after transfer: §83 applies. The vest is a taxable event in the US for the full vest value (US is the country of residence at vest).
Sourcing splits the income between UK-source (for UK work periods) and US-source (for US work periods).
US-UK treaty allows FTC in either direction for tax paid on the source portion.

For the PM’s 40,000 unvested RSUs vesting over 4 years, with 3 UK years and 1 US year before first vest, 4 US years after transfer:

Vest 1 (4 years post-grant, which is 3 years UK + 1 year US): 75% UK-source, 25% US-source.

Vest 2 (5 years post-grant, 3 UK + 2 US): 60% UK-source, 40% US-source.

And so on. Each vest has its own sourcing calculation.

Visa considerations

L-1B (specialized knowledge) is common for UK-to-US intra-company transfers. L-1B does not confer US tax residency automatically; day count and substantial presence test (IRC §7701(b)) determines residency.

Substantial presence test: 183 weighted days in the US over current and prior two years (full days in current year, 1/3 days in prior, 1/6 days in year before that). Typically, a full-year US transfer meets substantial presence in the first or second year.

For the transfer year:

First year may be a dual-status year (nonresident alien for part of the year, resident alien for the rest).
Dual-status filers have complex rules: the transfer date is often the residency start date, and pre-transfer income is filed on Form 1040-NR.

Some transferees elect first-year residency under IRC §7701(b)(4) to treat the full year as US resident. This can provide better treatment of RSUs vesting mid-year but exposes pre-transfer income to worldwide taxation.

The US-UK totalization agreement covers Social Security and UK NICs. For L-1 transfers under 5 years, the UK system typically continues to apply. The transferee gets a certificate of coverage from HMRC declaring UK NICs coverage, presents it to US payroll, and US FICA is not withheld.

For transfers expected to exceed 5 years or for permanent relocation, US FICA applies from the start.

Comparison: common UK-to-US equity transfer scenarios

Scenario	UK treatment	US treatment	Planning note
SAYE options exercised pre-transfer	UK favorable, no income tax	Not applicable	Best case; no US tax on exercise spread
SAYE exercised post-transfer	UK favorable if still qualified	US §83 on spread	Sourcing split required
EMI vested pre-transfer, exercised pre-transfer	UK CGT only	Not applicable	Best case
EMI exercised post-transfer	UK CGT at sale	US §83 on spread	US treats as NSO
RSU vests post-transfer	UK income on UK-source portion	US income on full; FTC for UK	Standard cross-border treatment
New US RSU grant post-transfer	Not yet relevant	US §83 on vest	Normal US employee treatment

Planning window: the 60-90 days before transfer

Critical moves to consider in the window before the US arrival date:

Exercise SAYE options if economically sound and plan terms allow.
Exercise vested EMI options if CGT treatment preserved.
Review unvested RSUs: is it worth an “in-country” acceleration if available?
Sell UK-concentrated positions while still UK-taxed (pre-US residency start).
Close or consolidate UK brokerage accounts to simplify future FATCA filings.
Obtain NICs certificate of coverage.
Arrange US tax preparer with UK-US experience.

Frequently asked

Do I lose my UK CGT annual exempt amount when I move to the US? The UK annual CGT exemption (£3,000 in 2025/26) is only useful for UK-taxable gains, and applies only if you are still UK-resident or have UK-situs assets.

Can I keep contributing to my UK SIPP pension after moving to the US? Yes, but the US will tax contributions and growth unlike the UK. The US-UK treaty has specific pension provisions worth reviewing; employer contributions may have favorable treatment.

What if I return to the UK later? Your post-transfer grants, if vested while US-resident, were fully US-taxed. UK on return will tax future events based on UK source; double-tax on already-US-taxed income can usually be avoided via treaty.

How does this interact with the UK’s 90-day rule? UK tax residency uses the Statutory Residence Test. Once non-resident under SRT, UK still taxes UK-source income. Your RSU vests for the UK-source portion remain UK-taxable even as non-UK-resident.

Does UK NIC apply to the US-source portion of a cross-border vest? If you are UK-resident for the NIC purposes during the vest (uncommon if transferred), potentially. If you have a US-side certificate of coverage (totalization), no.

Next step

If you are in the planning window before a UK-to-US transfer, engage a dual-qualified tax advisor at least 60 days before your intended US arrival date. Build a grant-by-grant analysis of every UK equity interest, project the tax consequence under multiple exercise scenarios, and choose the pre-transfer actions (exercises, sales, account consolidations) that produce the cleanest outcome.