Individual entrepreneurs will face new tax burdens starting from 1 January 2025. Find out what changes Ukrainians should prepare for

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Starting from 1 January 2025, taxes for individual entrepreneurs (IEs) will increase in Ukraine. Here's how much Ukrainians will have to pay.

From now on, entrepreneurs will be required to pay a single social contribution (SSC) and military duty. Taxes will have to be paid even if they have no income.

New taxes for individual entrepreneurs

In 2025, taxes for individual entrepreneurs will increase by several thousand hryvnias.

Sole proprietors of the first group

🔻 Single tax of UAH 302.80 (mandatory payment);

🔻 Unified social contribution 1760 UAH (mandatory payment);

🔻 military fee of UAH 800 (mandatory payment).

The monthly tax burden for sole proprietors in the first group will increase by UAH 2,560. This amount will amount to UAH 7,680 per quarter, and UAH 30,720 annually.

Sole proprietors of the second group

🔻 Single tax of UAH 1600 (mandatory payment);

🔻 UAH 1760 (mandatory payment);

🔻 military fee of UAH 800 (mandatory payment).

In total, taxes will amount to UAH 4,160 per month, which is almost three times more than in 2024. In quarterly terms, it will amount to UAH 12,480, and UAH 49,920 for the year.

Individual entrepreneurs of the third group

🔻 Single tax - 5 per cent or 3 per cent plus VAT on income (mandatory payment);

🔻 1% military tax on income (mandatory payment);

🔻 UAH 1760 of unified social tax (mandatory payment);

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Other changes for entrepreneurs

Starting from 2025, all entrepreneurs, except for those operating in the areas of hostilities, will have to provide cashless payments (POS terminal). The exemption for entrepreneurs in settlements with a population of less than 5,000 people will no longer apply. The moratorium on documentary scheduled inspections for all individual entrepreneurs has also been lifted.

If an entrepreneur does not want to pay contributions or report, there are two options: to close the sole proprietorship or to transfer it to the general taxation system, where the rule applies that no taxes are paid in the absence of income. Those who do not wish to fulfil these obligations should apply to the tax authorities for termination of their business or change of taxation system.

Penalties and exemptions

The law provides for an exception for Ukrainians. Thus, they do not have to pay the military fee:

▪️ sole proprietors in the temporarily occupied territories;

▪️ sole proprietorships of military personnel;

▪️ sole proprietors during sick leave and holidays (one month per year);

▪️ E-residents.

Other entrepreneurs will be required to pay taxes under the new rules, otherwise they will face a fine of 50% of the unpaid tax amount.

Doing business is always accompanied by legal issues, regardless of the scope of activity or the size of the company. Correctly drafted contracts, compliance with the law, resolving tax or labour disputes are just some of the tasks that require a professional approach. If you face any difficulties in the above issues, we recommend that you seek legal advice from a business lawyer.

We remind you! Liquidation of a sole proprietorship requires clear preparation and compliance with all legal procedures. Modern digital technologies, such as the Diia platform, greatly simplify this process. But is it really that simple? We have explained why the services of a business lawyer are the best choice for the successful closure of a sole proprietorship.

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