A finite element numerical simulation is carried out to determine the stress distribution on railhead in the vicinity of an insulated rail joint suspended between sleepers. The dynamic wheel load due to rail end discontinuity is considered in the simulation. The dynamic loads are treated as Hertzian pressure modified for plasticity of the railhead and discontinuity of the rail section near endpost.Submodelling is considered in this simulation to present stress distribution on the railhead. Von Mises stresses in loading and unloading (residual), vertical stresses and equivalent plastic strains are presented. Shakedown theorem is considered to apply a peak pressure load on the rail which is below the shakedown limit. As a result, a non-progressive damage of the railhead material is anticipated. Residual longitudinal stress is critical for damage of the railhead top surface and von-Mises along with vertical stresses is significant for subsurface damage of the railhead in the vicinity of rail joint.