Modelling Restricted Stock Units
We are pleased to announce the addition of Restricted Stock Units (RSUs) modelling capabilities within Voyant. This addition provides a clear, visual projection of how these grants will affect the clients' long-term wealth and cash flow. Watch the assets step up over time as the shares vest. The Taxes chart can be reviewed to identify any associated projected tax liability in the year of vesting.
Dashboard
To add an Employee stock option or Restricted Stock Units (RSU) go to Dashboard > + button bottom right > select Savings & Investments >
Select Stock Grant
While Voyant offers four "Grant Types", this article focuses specifically on Restricted Stock Units (RSUs). For guidance on Company Share Options, Enterprise Management Incentives, or Non-tax advantaged share options, please refer to our dedicated guide on these.
An Restricted Stock Unit (RSU) is an employer's promise to grant an employee company shares upon meeting specific restrictions (i.e., vesting). At the point of vesting, the employee incurs Income Tax and National Insurance shown in the Taxes chart based on the share's value at that time. Once they vest, they will appear in the Assets and Net Worth charts and are available for use in the plan using the Liquidation feature.
If the employee holds the shares after they vest and the share price increases, any profit realised when they eventually sell the shares will be subject to CGT (Capital Gains Tax).
Voyant Modelling Notes: Unlike other accounts, Voyant does not allow for ad-hoc withdrawals from RSU accounts in the cash flow. This is to allow you full control on when to realise money from these type of accounts. To release funds, you must explicitly schedule a 'liquidation' event to withdraw money from this asset.
Any surplus money from a RSU liquidation will be saved by default (as opposed to assumed spent).
Basics
- Owner - select the owner who is in receipt of the share options or RSUs.
- Grant Name - Give the entry a name, which will appear under Savings & Investments in the Dashboard screen.
- The Grant Date is the date the grant was started. This will determine the first year in the Future Vesting schedule. For example, if the grant date is in 2027, then the first possible vesting year will be 2028.
- Current Price is the value of the shares at time of entry into Voyant.
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Linked Employment - Link to the relevant employment income, so that only one set of National Insurance Contribution (NIC) thresholds are applied when taxing the Restricting Stock Units. If unlinked Voyant will treat the RSUs as a separate income from their employment income, in terms of the National Insurance Contribution thresholds.
Note if there are multiple RSUs vesting in the same year these will be aggregated together for National Insurance Contributions purposes, along with the employment income, if you have linked to that income in the RSU Basics screen.
- Number of shares remaining - this is the number of unvested shares that have been issued by the stock grant at the time of entry into Voyant. In this case the owner has 1,000 unvested shares that vest over 5 years. Do not include any previously vested shares, as part of this stock grant, which are instead entered in the Vested/ Exercised Shares section.
- Remaining vesting period - The number of years the shares vest over.
Growth
You can enter a growth rate on the shares, so that future shares will be issued at a higher price, and vested shares will grow in value over time.
Vested/ Exercised Shares
If your client has shares that are already vested you will be prompted to "Add Share Block" for those vested shares. These already vested shares will be shown in the RSU account Balance from year 1 in the Assets chart and be categorised as shares vested and held under the 'Hold' section in the Year View details.
Note the Grant Date in the Basics screen must be before the Date Vested for previously vested shares. For example:
- The Grant date in the Basics screen could be 2023,
- With previously shares vested in 2024 before the start of the plan, enter these 2024 shares in 'Vested/ Exercised shares'.
- Then new shares vest from 2025 onwards, which are in the plan and so entered in 'Future Vesting'.
Future Vesting
Now go to Future Vesting and select 'Estimate Schedule'. This will divide the Number of Shares Remaining by the Remaining Vesting Period, to give the number of Shares Vested each year. You can edit this if it is different from this.
Scheduling a liquidation event
The Restricted Stock Units will, currently, not be used in the plan, unless you instruct a liquidation.
To schedule a withdrawal from your Restricted Stock Units (RSUs), navigate to the Liquidation section and follow these steps:
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Select Liquidation Type. Choose one of the following options:
Number of Shares Remaining (Recurring)
All Available
Fixed Amount (Recurring)
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Define when the liquidations start in Liquidation Event:
Select an existing event on the timeline (e.g. "Retirement").
Or Double-click anywhere on the Timeline to create a new event.
Enter Withdrawal Details: Input the specific number of shares or the fixed amount you wish to liquidate each year.
If you would like to vary the withdrawal use Steps, as explained below.
Once you have returned to the Dashboard you can toggle on Year View and use the slider bar to look at the liquidation event year. You will be able to see the expected proceeds.
Future Grant
If you would like to set up a future grant with the same vesting period as your main entry, then you can add a future grant event in this section. If this is a one-off second issue, then select the same event in the start and end event. If new RSUs are issued each year, then select the appropriate events on the Timeline.
Steps
Use the steps feature to step up or down any liquidation instructions.
Click Done to save the step and click Done again to save the Restricted Stock Unit entry.
Checking the Plan - Year View
Once you have saved your RSU entry, you can check that everything is set up by going to Year View - Investments - and click on the name of the RSU you just created. In here you will see information about the Restricted Stock Units.
- Granted - this is the total number of shares granted
- Unvested - this tracks how many shares are still to vest. They will move from unvested to hold once vested.
- Hold - this is the number of shares that have vested and that the client owns and is therefore able to liquidate if needed.
- Vested Shares - shows the number of shares that vest in that year. They will be subject to income tax and national insurance, so you may also see an expense to pay for the tax depending on the value of the shares. As the shares vest the EOY Balance increases.
- Granted Shares - If future grants are set up you will see them here.
- Liquidated Shares - If you scheduled the shares to liquidate in the future, then you will see a value in liquidated shares in the relevant year/s.
- The Strike price is not relevant for RSUs (it is used for the share option plans, see the guide for more on these).
Assets chart
See the RSU account in the assets chart step up over time as the shares vest. In the chart below the shares vest for 5 years and then grow at the set growth rate entered until liquidated at retirement.
Taxes chart
View the Income tax and National insurance tax increases in the years the shares vest. Compare to a different scenario by creating a What If plan. Once shares are liquidated view the Capital Gains Tax projections on the Taxes chart as well.