What are the types of tax systems for private entrepreneurs in Ukraine?

In Ukraine, individual entrepreneurs (IEs) can choose between two main taxation systems: general and simplified.

1. General taxation system:

• Taxation: An individual entrepreneur pays personal income tax (PIT) at the rate of 18% of net income (the difference between income and expenses), a military fee of 5%, and a unified social contribution (USC) of 22% of net income, but not less than the minimum amount.
• Accounting: It is necessary to keep records of income and expenses, supporting them with relevant documents.
• Reporting: Submission of an annual tax return on property and income and a report on the unified social contribution.

2. Simplified taxation system (single tax):

The simplified system is divided into four groups, each with its own conditions and limitations:

• Group 1:
• Activities: Retail trade in markets or provision of household services to the population.
• Income limitations: Up to UAH 1,085,500 per year.
• Number of employees: No employees.
• Tax rate: A fixed amount set by local councils, but not more than 10% of the subsistence minimum.
• Second group:
• Activities: Provision of services, production and/or sale of goods, restaurant business.
• Income limitations: Up to UAH 5,421,000 per year.
• Number of employees: Up to 10 people.
• Tax rate: A fixed amount set by local councils, but not more than 20% of the minimum wage.
• Third group:
• Activities: Any activity not prohibited for the simplified system.
• Income limitations: Up to UAH 7,585,500 per year.
• Number of employees: Not limited.
• Tax rate: 3% of income (for VAT payers) or 5% (for non-VAT payers).
• Fourth group:
• Activities: Agricultural production.
• Income limitations: Not established.
• Number of employees: Not limited.
• Tax rate: Depends on the area and type of agricultural land.