Treatment of RSUs as income for Tax Credits

Does anyone have any experience of how restricted stock units acquired under an employee share ownership scheme should be treated by HMRC when calculating income for tax credit purposes?
I am preparing an appeal for a client who works for Amazon and received 2 shares worth just over £750 each in the 17/18 tax year, as did her partner. To receive these 2 shares, they each had to sacrifice another 2 (i.e. before vesting their notional entitlement was 4 shares each) and it is this double amount of just over £3000 which appears on each of their RSU payslips as “notional pay items shown but not paid”, and this is the figure which HMRC has used in calculating their relevant income for tax credits. Is this correct? Instinctively it seems unfair, as half of that amount has not been received, but I guess that’s no bar to it being correct under the regulations.

blimey.

had to google , which i assume you have

i found this

https://www.gov.uk/hmrc-internal-manuals/employment-related-securities/ersm20192

and wondered whether the tax credits people are looking at it the same way as their tax colleagues.

and am amazed that anyone on tax credits is also on RSU’s; i guess it’s amazon’s way of avoiding paying out some actual money?

i’d be inclined to check with an accountant as to the actual scheme being used and suchlike….

Thanks for the reply - and I know what you mean; over the weekend I did some research on MSE forums and tax law type websites, and mostly recipients of RSUs are talking about six-figure values for the stock they’ve received on these schemes, and are higher rate tax payers. I believe that while this scheme was operational, all Amazon employees were included (thought the vast majority of their staff are temporary agency workers who would not). At the time of their tax credits claim, my clients were both working part time following the birth of their first child in April 2017, but the RSUs they received in August had mostly been qualified for before then. The appeal really turns on the issue of this ‘income’ putting them over the threshold income for child tax credit, meaning that they have been assessed as having an overpayment of the CTC that they received (about £1500). Sadly, having now got my head around how the scheme actually works, I believe that the RSU income has been treated correctly; technically, they received four shares each, but two were sold to pay the tax and NI due on them. Because you can only sell whole shares, the money generated by the sale is more than the tax and NI due, and this difference is then refunded via payroll.
I’m sure you’re right about it having some kind of (tax?) advantage to Amazon; now that they’ve committed to paying the living wage, they’ve withdrawn the scheme.
Low Income Tax Reform Group advised that the treatment for tax credits generally follows the treatment for income tax.