Taxes in Ukraine

Corporate income tax

Corporate tax (standard)18%

Insurance activity

There is an additional tax for insurance activity – 3% or 0% on the income of these companies. The contracts with term life insurance, a voluntary health insurance and insurance contracts within the non-state pension have the rate 0%.

Gambling activity

Legal entities involved in gambling have to pay special CIT at 10%. The rate 18% can be applied to special gambling activity. This CIT paid from gambling income do not reduce taxable profit of a company engaged in gambling activities, so additionally they have to pay standard CIT 18%.

For non-residents

Legal non-resident entities  

Rates for legal entities-non-residence pay CIT at 0%, 4%, 6%, 12%, 15% and 20% from their income (tax rates varies depending on type of income).

Permanent establishment

Tax rates and taxable profit for permanent establishments are the same as for residence in Ukraine.

VAT

The general VAT in Ukraine20%
  • 7% – this rate is applied to supply and import of registered medicines and specific medical goods.
  • 0% – this rate is applied to the export of goods. Other services which are subject of 0% rate are an international transport services confirmed by a single international shipping document, toll manufacturing services if the goods are exported from Ukraine, etc.
  • Provision of services to a non-resident are subject to 20% VAT or it can be considered as an outside the scope of VAT, depending on the place of supply.

IT industry

Starting January 1st, 2013 until January 1st, 2023, IT companies that perform activities in Ukraine are exempted from VAT payments on operations of software products supply.

Software products are considered: the result of computer programming in the form of operating system, systemic, applied, entertaining and / or educational computer software (their components) as well as websites and / or online services; cryptographic data protection.

Social security and health insurance

Employer22%

Employers are liable to pay Unified Social Security Contributions. The social security contribution in Ukraine is 22% of the gross earnings (salaries and benefits paid to employees).

This percent is applied to salaries which are less than 25 subsistence minimums for able-bodied persons. If the salary is higher, then only the amount up to 25 subsistence level for able-bodied persons is taxable, while the rest is non-taxable.

The subsistence level for able-bodied persons in Ukraine is UAH 1,600 (approx. EUR 55) starting January 1st, 2017.

The 22% from gross salary is divided among different funds (unemployment fund, accident fund, pension contribution and temporary disability fund).

Dividend Tax

Dividend Tax15%

Dividends paid to residents and non-residents are subject to 15% withholding tax.

Personal income tax – rates

Income Tax18%

Transport Tax

Starting January 1st, 2017, owners of cars which are not older than five years and with an average market value exceeding 375 minimal salaries as of January 1st of the reporting year (approx. EUR 40,000) must pay transport tax in amount UAH 25,000 for each car per year.