The law on tax hikes will come into force on December 1, 2024, and not today, as reported the day before. This was announced by the Chairman of the Committee on Finance, Taxation and Customs Policy Danylo Hetmantsev.
Yesterday, President Volodymyr Zelenskyy signed Law No. 11416-d amending the Tax Code, which provides for an increase in military duty and other taxes. The document had been waiting for his signature for more than 40 days.
Changes to the military fee
Starting from December 1, 2024, Ukraine will increase the military tax on individuals from 1.5% to 5% on all types of income, including salaries. This means that employers will pay 3.5% more taxes on official salaries. The personal income tax (PIT) remains unchanged at 18%, and the unified social contribution (USC) at 22%.
The total tax burden on wages will increase from 19.5% to 23%, which means that UAH 230 will be deducted from every thousand hryvnias instead of UAH 195.
The increase in the military tax rate will also apply to interest income from individuals’ deposits, while the rate for military personnel will remain at 1.5%.
Military duty for individual entrepreneurs
For individual entrepreneurs (IEs) from the 1st, 2nd and 4th groups of the single tax, a military duty is introduced at the level of 10% of the minimum wage, which is currently UAH 8,000. Thus, these entrepreneurs must pay an additional UAH 800 per month. For sole proprietors of Group 3, the rate is 1%, which means an increase in their monthly payments from UAH 50 to UAH 60 per thousand of income.
New requirements for tax reporting
Starting from January 1, 2025, monthly reporting on personal income tax, unified social tax and military duty will be introduced for all tax agents. The current quarterly reporting will continue until the end of this year.
Individual entrepreneurs will be obliged to report on the payment of the military fee, and the first report will be submitted for 2024 (starting from October 1).
Changes in corporate taxes
Gas stations will now be required to pay advance income taxes, the amount of which will depend on the number of fuel outlets and the availability of stores. For gas stations without selling alcohol and tobacco products, the advance payment will amount to UAH 60 thousand, and for gas stations with them – UAH 80 thousand.
The rent for the extraction of crushed stone, sand, and coal is also increasing. For banks, the income tax rate for 2024 will be 50%. For non-bank financial organizations, the income tax rate will increase to 25% starting in 2025.
Tax changes for agricultural producers
The minimum tax liability for agricultural producers has been increased to UAH 700 per hectare, and for plots with a share of arable land of more than 50% – to UAH 1400.
National Cashback Program
Income received under the National Cashback program will be exempt from taxation.