When a sole proprietor is exempt from paying military duty: conditions and exceptions

Tax holidays, long-term illness, mobilization, and other good reasons for exemption from military duty. Find out under what conditions individual entrepreneurs (IEs) can be exempted from paying military duty

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In certain cases, individual entrepreneurs (IEs) may exercise the right to be exempt from paying the military fee (MF). However, these benefits are subject to restrictions and specific conditions, according to Novyny.LIVE.

Let us consider the main situations when this is possible, taking into account the current legislation of Ukraine.

Military duty and individual entrepreneurs: when can you use the tax holiday?

1. Tax vacation and long-term illness

Sole proprietors of the single tax groups 1 and 2 who do not have employees have the right not to pay the military fee for one month a year. This is possible under the following conditions:

- a tax leave has been issued;

- a confirmed illness lasting more than 30 days (an extract from the Electronic Register of Sick Leave Certificates must be provided).

It is important to understand that the absence of employees does not in itself exempt from the obligation to pay the EHT. Such an exemption is valid only if the specified conditions are met and for a limited time.

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2. Sole proprietors in the occupied territories or in the combat zone

Law No. 4113 provides benefits for sole proprietors of groups 1 and 2 if their tax address is located

- in the temporarily occupied territories;

- in the area of active hostilities.

In such cases, sole proprietors have the right not to pay the military fee for the period from the beginning of the occupation or hostilities until their completion. Also, the State Tax Service will not charge advance payments for these entrepreneurs.

3. Income not subject to personal income taxation

Sole proprietors are exempt from paying WHT if their income

- are not subject to personal income tax (PIT);

- are taxed at a zero rate.

4. Mobilization to the Armed Forces of Ukraine

If an individual entrepreneur is mobilized to the Armed Forces of Ukraine, he or she is exempt from paying the military fee for the entire period of mobilization.

5. Taxation of income of military personnel

The remuneration of servicemen performing military service is subject to military duty at the rate of 1.5%. This rule does not depend on other benefits or the status of the individual entrepreneur.

A sole proprietor may not pay the military tax only in cases specified by law, in particular, during tax holidays, in connection with mobilization, staying in a war zone or occupation, or if income is exempt from personal income tax. In other situations, the obligation to pay the military fee remains unchanged.

We remind you! Starting from 1 January 2025, the payment of the unified social tax will be resumed for most entrepreneurs. However, certain categories of individual entrepreneurs will retain this benefit.

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