Taxes in Ukraine in 2026: income tax and tax residency

Ukraine tax rates in 2026: at a glance

Every salary in Ukraine loses 23% in 2026: 18% personal income tax plus a 5% military levy. The employer pays another 22% unified social contribution on top, out of its own pocket. Until 1 December 2024 the military levy was 1.5%, and Law No. 4835-IX of 7 April 2026 locked in the 5% rate for three more years after the year in which martial law ends.

Small business plays by different rules. A FOP (fizychna osoba-pidpryiemets, Ukraine's private entrepreneur or sole proprietor) on the simplified system hands over 5% of turnover, a 1% military levy and a fixed social contribution. That gap between 23% and 6% shapes how work and income are structured across the country.

Almost every fixed amount is pegged to two figures from the state budget law. The minimum wage for 2026 is 8,647 hryvnias a month (8,000 in 2025), and the subsistence minimum for working-age adults is 3,328 hryvnias. The hryvnia (UAH) is Ukraine's currency; at the National Bank rate in 2026 a US dollar costs about 45 hryvnias and a euro about 51. The minimum wage is roughly 193 dollars.

For those who have left, the real question is status, not rates. Under the Tax Code an active FOP registration is enough to make its owner a Ukrainian tax resident, and a resident must declare worldwide income. A separate section below covers this. Rates in other countries are collected on the taxes by country page.

Compare taxes in 146 countries: relocation taxes 2026

Who is a tax resident of Ukraine

Ukraine has no simple 183-day rule: days are counted only at step four, when the first three tests have failed to give an answer. Subparagraph 14.1.213 of the Tax Code lines the tests up in order, and the day count is often never reached.

Everything else follows from status. A resident pays tax on income from anywhere in the world, a non-resident only on Ukrainian income.

One sentence in the same subparagraph sits above this ladder, and for emigrants it matters most. A sufficient ground for treating someone as a resident is their own designation of a main place of residence in Ukraine, or registration as a self-employed person. A FOP is exactly that, a self-employed person.

The conclusion is uncomfortable: while the FOP stays open, the Code treats its owner as a resident no matter how many days are spent abroad. The reverse link holds too: a non-resident may not use the single tax (paragraph 291.5 of the Code), so keeping the 5% regime while leaving Ukrainian residency is not an option.

How status is confirmed

Residency is confirmed by a certificate of Ukrainian tax resident status. The State Tax Service (DPS, Derzhavna podatkova sluzhba) issues it on application, usually for a foreign bank or another country's tax office. A non-resident, in turn, gives the Ukrainian payer a certificate of residence from their own country, otherwise treaty relief is not applied.

The Code also has a rule on second passports. A Ukrainian citizen who acquired another citizenship in breach of the law is treated for income tax purposes as a Ukrainian citizen only and loses the right to credit taxes paid abroad. Since 16 January 2026 Law No. 4502-IX on multiple citizenship has allowed a second passport in a number of cases, so the lawfulness of a second citizenship now has to be checked case by case.

How 183-day rules work in other countries, and why they do not match, is covered in our article on tax residency in 2026.

Ukraine tax residency rules: how status is decided and confirmed

In Ukraine the 183-day rule comes only fourth in line. The Tax Code first looks at your home, then at your permanent home, then at your centre of vital interests, and only after that counts days. It works like a strict doorman: before checking the calendar, it asks where your flat is and who waits for you there.

The law defines the centre of interests simply: a family in Ukraine or a sole trader registration is enough. A resident pays 18% tax plus the 5% military levy on worldwide income, a non-resident only on Ukrainian income. The status is confirmed by a certificate from the State Tax Service.

The law does not stop you from confirming the status on your own. But mistakes cost more: an open sole trader registration keeps you resident, while the tax office of your new country also taxes the same salary. Murblz support removes these risks: we run all four tests, count the days, obtain the residence certificate and apply the double tax treaty. We guarantee professional work and a transparent process, and in most cases a result on the first filing.

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Do you pay tax in Ukraine if you live and work abroad

Spending 183 days abroad changes nothing by itself: as long as a home, a family or an active FOP remains in Ukraine, the Code treats the emigrant as a resident. And a resident must report worldwide income in a tax return and pay 18% income tax and the 5% military levy on it (paragraphs 13.3 and 170.11 of the Tax Code).

The return for the previous year is due by 1 May and the tax by 1 August. Foreign dividends are taxed more lightly: 9% plus the 5% military levy.

How the foreign tax credit works

A credit is available only where Ukraine has a double tax treaty in force with the country the income came from. It requires a certificate from that country's tax authority showing the tax paid and the base it was calculated on. Under paragraph 13.5 of the Code the certificate must be legalised unless the treaty says otherwise.

If the certificate will not arrive by 1 May, an application moves the filing deadline to 31 December. Without an application and without a return, penalties start to run.

The credit is capped at the Ukrainian tax on the same income. And the main limit: the credit reduces income tax only. The 5% military levy is paid in full even if the foreign tax was already withheld at a rate above Ukraine's.

Dual residency: when two countries claim the tax

Poland, Germany and the Czech Republic treat as a resident anyone who spent more than 183 days there in a year or has a permanent home or centre of vital interests there. After a year in Warsaw or Berlin, two states regard the emigrant as their resident and both claim tax on worldwide income. The rules of those countries are on our pages about taxes in Poland, Germany and the Czech Republic.

The double tax treaty settles the dispute. It checks in turn: where the permanent home is, where the centre of vital interests lies, where the habitual abode is and which citizenship is held. An international treaty outranks the Code, so if the other country wins, Ukraine may tax only Ukrainian-source income.

None of this happens automatically. It takes a certificate of tax residence from the other country and a readiness to explain to the tax office why the centre of interests has moved.

What non-resident status costs

The formal exit from Ukrainian residency is departure for permanent residence abroad. Paragraph 179.3 of the Code requires a tax return no later than 60 calendar days before departure; the tax office checks the figures and issues a certificate of tax paid. This is a separate procedure: temporary protection in the EU or an ordinary residence permit does not replace it.

Non-resident status has a price, and it is high for owners of property in Ukraine.

Hiding foreign accounts no longer works. On 30 September 2024 Ukraine carried out its first automatic exchange of financial account information under the CRS (Common Reporting Standard): the Ministry of Finance reported that the exchange was completed successfully, and about 110 jurisdictions take part in the standard. The next step is an exchange of data on income earned through digital platforms: the Verkhovna Rada passed a law on it on 9 June 2026, and it is awaiting the president's signature.

Owners of foreign companies also need to remember the CFC (controlled foreign company) rules: a Ukrainian resident reports shareholdings abroad and declares the profits of such companies. How it works is described on our CFC page.

Ukraine income tax and payroll taxes in 2026: a salary example

Out of a UAH 30,000 salary the employee takes home 23,100, while the employer's total cost is 36,600. The state collects 36.9% of everything the company spends on the worker, and it does so with a flat scale and not a single higher bracket.

Two amounts are deducted from pay. Personal income tax is 18% of any earnings, with no tax-free allowance and no progression (paragraph 167.1 of the Tax Code). The military levy is 5% of the same amount. The employer withholds and remits both.

The third payment is invisible to the employee. The USC (unified social contribution, which funds pensions, sick pay and unemployment benefits) is charged by the employer on top: 22% of salary. The base is capped at 20 minimum wages, UAH 172,940 a month, so the largest contribution for one employee is UAH 38,046.80. At the main place of work it cannot fall below the minimum contribution: 22% of UAH 8,647 is UAH 1,902.34.

This is a worked example with no reliefs. The tax social benefit in 2026 reduces taxable salary by UAH 1,664, but only when monthly pay does not exceed UAH 4,660. That is below the minimum wage, so in practice the benefit goes to part-time workers and to parents of several children, for whom the income ceiling is higher.

For comparison: Poland has a progressive scale of 12% and 32%, and Moldova a flat 12%. Ukraine's 23% is almost double Moldova's, but a high salary here never moves into a higher bracket.

Military levy: who pays 5% and for how long

The military levy was introduced in 2014 as a temporary 1.5% charge. Law No. 4015-IX raised it to 5% from 1 December 2024. The old 1.5% survives only for service members and defence forces personnel.

The levy now has a clear horizon. Law No. 4835-IX of 7 April 2026, in force since 15 April, extended the 5% rate for individuals for three years following the year in which martial law ends. Entrepreneurs on the single tax will pay their levy for the same three years.

Part of the income tax can be recovered through the tax discount (podatkova znyzhka, the equivalent of a tax deduction): for tuition, mortgage interest on a main home, life insurance and donations. The return claiming it is due by 31 December of the following year; the military levy is not refunded.

What taxes a private entrepreneur (FOP) pays in Ukraine in 2026 and whether it can be run from abroad

A group 3 FOP hands the state about 8% of turnover where an employer with a salaried worker hands over almost 37%. Ukraine's IT exports and freelance market rest on that gap, and it is exactly what the government plans to narrow in the coming years.

The simplified system (single tax) replaces income tax and, in most cases, VAT for an entrepreneur. Payers are split into groups by activity and annual income; the limits are pegged to the minimum wage and rose with it in 2026.

Every regime adds the entrepreneur's own USC: on the single tax at least UAH 1,902.34 a month (UAH 5,707.02 a quarter), on the general system 22% of net income. The martial-law exemption from the contribution does not apply in 2025 or 2026, so single tax payers owe the minimum even for quarters with no income. The exceptions are pensioners, entrepreneurs with a disability and those whose employer at a main job already pays at least the minimum contribution for them.

Income above the group limit is taxed at 15% (paragraph 293.4 of the Tax Code), after which the entrepreneur moves to a higher group or to the general system.

Worked example: a freelancer in group 3

If a company spends the same UAH 90,000 on a salaried employee, taxes and contributions take UAH 33,197 and take-home pay is UAH 56,803.

Running a FOP from abroad: what is allowed and where the risk lies

The law does not forbid running a FOP while living in another country: returns go through the taxpayer's electronic cabinet and the money lands in a Ukrainian bank account. But the setup has three consequences that are rarely spelled out.

First: an active FOP locks in Ukrainian residency, and with it the duty to declare all other foreign income at 18% plus 5%.

Second: after 183 days the country of residence usually treats the FOP owner as its own resident too and wants tax on income from work physically done on its territory. The single tax is not named in the older double tax treaties, and whether the local tax office will credit it is its own decision. In the worst case the same income is taxed twice.

Third: social contributions. Ukraine's USC does not remove the obligation to pay contributions in the country where the entrepreneur actually works.

So the choice usually comes down to two options: close the FOP and register the business where life actually happens, or keep it and run the numbers in two countries. Murblz specialists compare both options in figures; business registration abroad is covered on our company formation and company in Poland pages.

Ukraine corporate tax rate, dividend tax and VAT: what a company pays

Banks in Ukraine give half their profit to the budget in 2026: Law No. 4698-IX of 3 December 2025 set their rate at 50%. Other companies pay 18%, and that base rate has not changed since 2014.

How dividends are taxed

An individual owner receives dividends from a company that pays corporate tax net of 10%: 5% income tax and the 5% military levy. If the company is on the single tax or registered abroad, the income tax rate rises to 9%, making 14% in total (paragraph 167.5 of the Tax Code).

Dividends to a foreign corporate shareholder are taxed at source at 15%. Double tax treaties reduce that, often to 5%, provided the recipient has confirmed its residence and beneficial ownership of the income.

Diia City: 5% instead of 18% for IT

Diia City is a legal regime for IT companies that has operated since 2022. An employee of a resident company pays 5% income tax instead of 18%, the military levy stays at 5%, and the company charges USC only on the minimum wage: UAH 1,902.34 a month whatever the salary. The company itself chooses between the ordinary 18% on profit and a 9% exit capital tax, which is paid only when profit is distributed.

Entry is not open to everyone. A company needs at least 9 employees or contracted specialists, average monthly pay to them of no less than EUR 1,200, and 90% of income from qualifying activities. The regime's website states that the terms are fixed for 25 years.

Ukraine VAT rate and when registration is required

The standard rate of VAT (value added tax) is 20%. There are three reduced rates: 14% on imports and supplies of certain crops, 7% on medicines and medical goods, and 0% on exports. The standard rate is 23% in Poland and 19% in Germany.

Registration is mandatory once taxable turnover over 12 months exceeds UAH 1 million, about USD 22,000. The rule does not apply to single tax payers on the 5% rate: for them VAT is included in the single tax. Foreign companies selling electronic services to Ukrainian consumers have paid the same 20% since 1 January 2022.

Two changes are worth keeping in mind. The VAT exemption for electric cars ended on 1 January 2026. And on 16 September 2026 the Verkhovna Rada passed bill No. 16051-1 at first reading: it brings in 20% VAT on foreign parcels worth less than EUR 150, which currently arrive tax-free. The new rules will start no earlier than 2027.

Property tax, car tax, inheritance and crypto taxes in Ukraine

The first sale in a year of a flat owned for more than three years is tax-free, while the third already costs 23% of the price. Article 172 of the Tax Code taxes the whole sale amount, not the gain, and the rate depends on which sale of the year it is.

The base is the contract price, but not less than the appraised value recorded in the unified database of valuation reports. The tax is paid before the notary certifies the deal. On top come a 1% state duty and a 1% Pension Fund charge paid by the buyer.

Annual real estate tax

Real estate tax is charged not on the whole area but on the excess: the first 60 m² of a flat, 120 m² of a house and 180 m² for owners of both types are exempt. The local council sets the rate, capped at 1.5% of the minimum wage per square metre, which is UAH 129.71 for the 2026 tax year.

Worked example: a 90 m² flat in a city applying the maximum rate. 30 m² are taxable and the tax is UAH 3,891 a year, about USD 87. For flats larger than 300 m² and houses larger than 500 m², UAH 25,000 per property is added.

Cars

Few owners pay transport tax: UAH 25,000 a year is charged on a passenger car up to five years old if its average market value exceeds 375 minimum wages, UAH 3,242,625 in 2026.

The sale of one car a year is tax-free. The second is taxed at 5% income tax and the third at 18%, plus the 5% military levy in both cases.

Inheritance and gifts

There is no separate inheritance tax: inherited property is subject to income tax under Article 174 of the Code. Spouses, parents, children, brothers, sisters, grandparents and grandchildren pay 0%. Other heirs pay 5% plus the 5% military levy.

The most expensive line concerns those who have left: if the heir or the deceased is a non-resident, the rate is 18% plus the 5% military levy whatever the degree of kinship. A non-resident heir pays the tax before the notary issues the certificate of inheritance. The same rules apply to gifts.

Rent, deposits, investments and cryptocurrency

Rental income, interest on bank deposits and gains on securities are taxed alike: 18% plus the 5% military levy. The bank withholds tax on interest; on rent and investments the owner calculates and pays the tax. An exchange-rate difference on currency conversion is not treated as income.

Ukraine has no special regime for cryptocurrency. The Verkhovna Rada passed bill No. 10225-d on the virtual assets market at first reading on 3 September 2025, and until it becomes law, income from selling cryptocurrency is declared under the general rules as other income: 18% plus the 5% military levy. How crypto is taxed in other countries is covered in our article on crypto and taxes when relocating.

Taxes for non-residents and whether the Ukraine-Russia tax treaty still applies

The double tax treaty between Ukraine and Russia has not applied since 1 January 2023. The Verkhovna Rada denounced it in 2022, and since then Ukrainian-source income of Russian residents has been taxed at the full Code rates, with no relief and no credit in either direction.

The treaty with Belarus met the same fate: Law No. 2743-IX terminating it was adopted on 16 November 2022. The treaty with Iran has not applied since 1 January 2025.

For the recipient this means a double bill. Dividends from a Ukrainian company to a shareholder in Russia are taxed in Ukraine at 15% and then again under Russian rules. An inheritance or the sale of a Ukrainian flat by a Russian resident is taxed at 18% plus the 5% military levy.

Rates for non-residents

The tax is withheld by the Ukrainian party paying the income. A non-resident individual pays no Ukrainian tax on income earned outside Ukraine, but neither the simplified system nor the zero rates for family members are available to them.

Which countries have a working treaty

Ukraine has more than 70 double tax treaties in force, including all the large EU countries, the United Kingdom, the United States, Canada, Switzerland, Turkey, Kazakhstan and the UAE. They cut withholding tax, most often to 5-10% on dividends, and divide the right to tax salaries, pensions and income from property.

The network is being updated. On 19 May 2026 in Paris the finance ministers of Ukraine and Germany signed a new agreement; according to Ukraine's Ministry of Finance, once ratified it will replace the treaty of 3 July 1995. Until then the old text applies.

A reduced rate does not apply by itself. The recipient gives the Ukrainian payer a certificate of tax residence from its own country and must be the beneficial owner of the income, not a conduit. Without the certificate, 15% is withheld.

Those who are relocating and choosing a new country for their business may want to compare terms: taxes in Cyprus, taxes in Estonia and our overview of taxes in Europe in 2026.

What changed in Ukraine's taxes in 2025-2026 and what comes next

In two years the state more than tripled the military levy, extended it to entrepreneurs and fixed it in place for the post-war years. The base rates of 18% and 20% were left alone: the budget is being filled through the levy, the banks and a wider tax base.

Digital platforms: 10% instead of 23%, but the law awaits signature

The platforms bill changes life for taxi drivers, couriers, landlords and marketplace sellers. In the version the Rada passed on 9 June 2026 the platform itself withholds 10% income tax from their earnings from 1 January 2027, and no military levy is charged on that money. Today such income is formally taxed at 23%.

The law is not in force yet: the president has not signed it. On 27 August 2026 Finance Minister Serhii Marchenko explained the delay by an amendment on financial monitoring of politically exposed persons that made its way into the text and drew objections from European partners. In September 2026 the government submitted a bill with a corrected provision to the Rada, and the launch dates depend on when it is passed.

The preferential regime has limits: income of no more than 834 minimum wages a year (UAH 7,211,598 at the 2026 level), no employees and no excisable goods. Sales of goods of up to EUR 2,000 a year are not taxed at all. Under the text of the law, platform operators register with the tax service by the end of 2026, and the first international exchange of data on such income will take place in 2028, covering 2027.

For emigrants this will be the second channel after CRS through which the Ukrainian tax service learns about earnings abroad: the exchange runs in both directions.

VAT for FOPs has been postponed

On 18 December 2025 the Ministry of Finance published a draft under which entrepreneurs on the single tax with turnover above UAH 1 million a year would become VAT payers from 2027. After a dispute with business the date was moved: the updated memorandum with the International Monetary Fund lists mandatory registration from 1 January 2028 and promises a higher threshold. There is no law yet.

Anyone building a model on the 5% single tax should plan it over a two-year horizon, not ten.

Tax return deadlines and penalties in Ukraine

The fine for a tax return that was never filed is UAH 340, less than 8 dollars, and that figure lulls many people. The expensive part is elsewhere: if the tax office finds the unpaid tax itself, it adds 10% to 25% of the amount plus late-payment interest for every day.

An employee with a single salary needs no return: the employer has withheld everything. Filing is required of those who received income without tax withheld: from abroad, from letting a home to an individual, from selling investments, or an inheritance or gift taxed at a non-zero rate.

Returns are filed through the taxpayer's electronic cabinet with an electronic signature, so there is no need to be in Ukraine to do it. The tax year is the calendar year.

Penalties

Paying up to 30 days late costs 5% of the tax, longer than that 10% (Article 124 of the Tax Code). An assessment after an audit carries 10%, 25% for deliberate understatement and 50% for a repeated deliberate one (Article 123). Failing to file or filing late costs UAH 340, and UAH 1,020 for a repeat violation within a year.

CFC rules have a scale of their own. For failing to file a report on a controlled foreign company the Code sets a fine of 100 subsistence minimums, UAH 332,800, and for failing to notify the acquisition of a shareholding 300 minimums, UAH 998,400, about USD 22,000. These fines are not applied while martial law lasts and for six months after it is lifted, but the reporting duty has not gone anywhere, and the moratorium ends once that period is over.

The limitation period for additional assessments is 1,095 days after the filing deadline. If no return was filed at all, the period never starts to run.

Who benefits from Ukraine's tax system and who does not

Ukraine's system is generous to those who work for themselves inside the country and strict with those who left without formalising the move. Rates are secondary here: the outcome is decided by the mix of status, a FOP and property.

Good for freelancers and service exporters who live in Ukraine. Group 3 of the single tax means a burden of about 8% on monthly revenue of UAH 90,000 and requires no expense accounting. In the Czech Republic and Poland a self-employed person with that revenue generally pays more.

Good for IT companies with a team of 9 or more specialists. Diia City cuts an employee's income tax from 18% to 5% and the employer's contribution to UAH 1,902.34 a month.

Acceptable for highly paid employees. 23% is withheld from any amount and there is no higher rate. But there is no tax-free allowance either: the minimum wage is taxed at the same 23%.

Not suitable for emigrants with an active FOP. Ukraine keeps treating the owner as a resident, the second country treats them as its own resident after 183 days, and the single tax may not be credited abroad. The decision is better made before the first tax return in the new country, not after a letter from the tax office.

Not suitable for those receiving income from Russia. There has been no treaty since 2023: tax is withheld in both countries and cannot be credited.

Calls for a calculation by owners of Ukrainian real estate who live abroad. Non-resident status removes the question of declaring worldwide income, but selling a flat and inheriting will cost 23% instead of zero. Sometimes it pays to sell first and change status afterwards.

Calls for attention from owners of foreign companies. While residency is Ukrainian the CFC rules apply, and the moratorium on fines will end six months after martial law is lifted.

Ten-year plans are unwise. The military levy is fixed for at least three post-war years, VAT for entrepreneurs on the single tax is pencilled in for 2028, and data exchange from platforms is planned for 2028. The rules are moving closer to European ones, with fewer reliefs in them.

Where to start

Status first: where the home is, where the family lives, whether a FOP is open, how many days are spent in each country. Then the treaty between Ukraine and the country of residence: whose resident it makes the owner of the income. Only after that come rates and the choice between closing the FOP, moving the business into a company abroad and keeping Ukrainian residency.

Murblz specialists work through such cases together with locally licensed partners in the country of residence: they calculate taxes in both jurisdictions, prepare residency documents and help register a business and open an account. More on our legal support, company formation and business account in Poland pages.

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