Is there a direct migration path from on-premises RDS to AVD? Or will we have to first migrate to RDS from IaaS and from there to AVD?

If you want to use Windows 10 EVD with AVD then you cannot migrate to AVD directly from on-premises. If you want to continue using your existing image (Windows Server or Windows 10), you can migrate your VMs as long as you have the following also migrated/setup: AD with AAD sync, VNET, and user storage (optional if they want everything available in Azure). You can also use Azure Site Recovery for the same.

The other option is to migrate all your on-premises resources using ASR to Azure (inclusive of RDS components) and then once you have a validated environment, you can connect the VMs to AVD. We would recommend this option because many clients get stuck in the AD and VNET creation/sync step and then cannot deploy their AVD setup. A phased migration ensures that you get all of the AVD pre-requirements in place before attempting to use AVD.

Need help planning your move to Azure Virtual Desktop? Book your personalised consultation and demo with our 1-day complimentary workshop here