Forms of Taxation in Ukraine: How to Choose the Optimal Tax Regime for Your Business

Doing business in Ukraine involves many aspects, and one of the most important is the choice of tax regime. The form of taxation affects your tax liabilities, financial stability and opportunities for business development. In this article we will look at the 2 main forms of taxation available in Ukraine and help you decide which one to choose.

Main forms of taxation in Ukraine
There are several main forms of taxation in Ukraine, including:

1. General taxation system: This is the most common regime where companies are required to pay VAT at 20% and income tax at 18%. Under the general system of taxation, it is necessary to file reports with the tax service every month.

    

2. Simplified taxation system: For Individual Entrepreneurs or Physical Entrepreneurs (FOP) a simplified tax regime is available, which allows for simplified accounting and payment of a fixed tax of 5% of turnover. However, it should be remembered that the maximum turnover should not exceed 7,818,900 UAH, which is 210,000.00 USD, as of 2023. After exceeding this turnover you will be transferred to the general system of taxation. Under the simplified system of taxation you must submit reports to the tax service every quarter.