Ten questions about taxes: What and how much will Ukrainians pay in 2025?

1. Changes to the Military Tax on Salaries

Starting from December 1, 2024, the military tax on salaries will increase from 1.5% to 5%.

"It is important to note that the 5% military tax rate is implemented only for the duration of martial law in the country," says Andrey Shabelnikov, managing partner of "EvrikaLaw" law firm.

2. Introduction of Military Tax for Individual Entrepreneurs of All Groups

For individual entrepreneurs of groups 1, 2, and 4, a military tax of 10% of the minimum wage set on the 1st of the reporting month will be introduced. Starting from October 2024, this amount will be 800 UAH per month.

• Individual entrepreneurs of group 3 and legal entities of group 3 under the unified tax will pay 1% of their income as military tax.
• For military personnel, the military tax remains at 1.5% of the taxable object.

3. Change in Reporting Deadlines for Hired Employees

Previously, reports had to be submitted quarterly, but now they must be submitted monthly. The deadline for such reporting is set at 20 calendar days following the last calendar day of the reporting (tax) month.

4. Increased Profit Tax Rate for Banks to 50% for 2024

The Ministry of Finance, National Bank, and IMF opposed the increase in the banks' profit tax. In 2024, the profit tax for banks was raised from 18% to 25%. For 2025, the profit tax rate for banks has been increased to 50%.

According to Yaroslav Zheleznyak, a people's deputy and the first deputy chairman of the tax committee of the Rada, the forecast for revenue from this bill for the next year is 137 billion UAH due to the increase in the banks' profit tax.

5. Advance Payments for Gas Station Networks

For gas stations, a monthly advance payment of profit tax is established for each retail fuel trade location (if the owner is a legal entity) and personal income tax (if the owner is an individual) in the amount of 30, 45, or 60 thousand UAH.

6. Advance Payments for Profit Tax for Currency Exchange Offices

For businesses engaged in trading currency values in cash (currency exchange points), a tie to the euro exchange rate is established.

As noted by lawyer Andrey Shabelnikov, an advance payment of profit tax has been introduced in Ukraine: 700 euros for each exchange point in Kyiv, 600 euros in cities with a population of over 50 thousand, and 200 euros for other settlements. Previously, exchange offices paid advances based on the minimum wage.

7. Exemption from Personal Income Tax for Foreign Aid Received by Citizens in Other Countries

It is worth noting that Ukrainian refugees receive financial assistance under the norms of temporary protection (for 2022, 2023, and subsequent years until the end of martial law). Such payments are exempt from income tax.

8. Income from "National Cashback" Will Not Be Taxed in 2024-2025

Recall that in the fall and winter of 2024, citizens may receive payments under the state program "Winter eSupport" and the "National Cashback" program for goods and services purchased in Ukraine.

9. Increase in the Minimum Tax Liability for Farmers and Agricultural Producers

It has also been determined that this minimum liability cannot be less than 700 UAH per 1 hectare of land, and for plots where the arable land constitutes at least 50%, it is 1400 UAH per 1 hectare.

10. Notaries Will Report on All Contracts They Certify

Another interesting aspect is that notaries are now required to provide the State Tax Service of Ukraine with information about all contracts they have certified on a monthly basis. This will allow the tax authorities to have all the necessary data regarding acquired property and its volumes, and to question citizens about the origin of funds.

From now on, notaries are required to provide the State Tax Service of Ukraine with information about all contracts they have certified on a monthly basis.

In addition to the changes provided by Law No. 4015-IX, the Law of Ukraine on the State Budget for 2025 reinstates mandatory payment of the Unified Social Contribution (USC), meaning that the military exemption allowing voluntary USC payments has been canceled.

"Mandatory payment of USC for all individual entrepreneurs under the unified tax is reinstated at 22% of the minimum wage, which is 1760 UAH per month," adds Roman Mikhailovsky.

Will Tax Increases Help Increase Budget Revenues?

Experts note that the changes introduced in the tax legislation, aimed at increasing state revenues through higher tax payments, will likely lead to the opposite effect in practice.

"Since the full-scale invasion, less than three years have passed, and small and medium-sized businesses face constant problems and risks every day: power outages, reduced purchasing power of the population, disrupted logistics due to shelling, leading to additional costs, corruption risks in state supervisory bodies, and labor shortages due to the mobilization of the male population, among other issues. As a result, businesses are already on the brink of survival, as statistics on bankrupt enterprises have been increasing since 2022, indicating the impossibility for citizens to continue supporting existing businesses. Therefore, tax increases may lead to the remnants of currently functioning businesses partially transitioning to the shadow economy, as they will be unable to adequately pay all mandatory contributions to the state budget," noted lawyer Andrey Shabelnikov.