Employer Tax Contributions

Tax Type	Rate	Base
Unified Social Contribution (USC)	22%	Employee's Gross Salary (subject to cap)
Personal Income Tax (PIT)	18%	Employee's Gross Income
Military Levy	5% (for most citizens)	Employee's Gross Income

Filing & Compliance

• Monthly Payment: Withheld PIT, Military Levy, and accrued USC are generally due by the 20th day of the month following the reporting month.
• Quarterly Report: A consolidated report for PIT, Military Levy, and USC must be submitted quarterly by the 40th day following the end of the reporting quarter.
• Annual Tax Year: The fiscal year for companies generally follows the calendar year (January 1 - December 31).

In Ukraine, employers withhold and remit several taxes from employee salaries, including Personal Income Tax (PIT), military tax, and the Unified Social Contribution (USC).

Personal Income Tax (PIT)

The standard PIT rate is 18% of an employee's gross income.

Military Tax

As of January 1, 2025, the military tax rate increased to 5% of the employee's gross income. This represents a significant increase from the previous 1.5% rate.

Unified Social Contribution (USC)

The USC is a tax paid by both employers and employees. The employer's contribution is 22% of the employee's gross salary up to a monthly cap. As of January 1, 2025, this cap is 20 times the minimum monthly wage (UAH 160,000 as of this date, assuming a minimum wage of UAH 8000).

Tax Deductions

Several deductions can reduce an employee's taxable income. These include payments for education within Ukraine (capped at three times the minimum wage - UAH 24,000 monthly as of January 1, 2025), certain medical expenses, mortgage interest payments, life insurance premiums and charitable contributions, especially those directed towards military aid. Additional deductions may be available. Consult with a tax professional for specific guidance.

Employer Responsibilities

Ukrainian employers act as tax agents, responsible for withholding taxes from employee salaries and remitting them to the tax authorities. For bank transfers, taxes must be paid on the employee's payday. For cash payments, taxes must be remitted within three days. Employers must file quarterly payroll reports within 40 days of the quarter's end. Payslips, either paper or digital, must be provided to employees after each pay period, detailing salary, withheld taxes, and other deductions.

Tax Residency

Ukrainian tax residents are taxed on their worldwide income, while non-residents are taxed only on Ukrainian-sourced income. Both are subject to the same tax rates. Employees are generally considered residents if they are domiciled in Ukraine. Those who work remotely for Ukrainian employers while residing in another country may face different tax obligations in both countries. This can be a complex issue, and consulting a tax advisor is recommended.

Additional Information

• Minimum Wage: As of 2023, the minimum wage in Ukraine was UAH 6700 per month. Please verify the current minimum wage as it may have been adjusted since that time. Note that wages must be paid twice monthly, with an advance payment between the 15th and 20th and the remaining amount between the 1st and 7th of the following month.

• Annual Tax Return: If an individual's income was not fully subject to withholding by a tax agent (e.g. foreign investment income), they must file an annual tax return by April 30th of the following year and pay any remaining taxes. This also applies if claiming certain deductions.

This information is current as of February 5, 2025, and may be subject to change. Always consult with a qualified tax professional for personalized advice.