How income tax works in Ukraine
Ukraine taxes residents on worldwide income. Domicile, vital interests, 183 days or citizenship each establish residence with treaty tie-breaks for dual claims.
Salary pays a flat 18% plus 5% military levy for 23% combined, withheld by employers. The levy rose from 1.5% in late 2024 and runs through martial law plus three years.
Diia City employees and gig specialists pay 5% plus 5% with social charges on minimum-wage base only. Small entrepreneurs pay UAH 864.70 monthly or 1% of turnover by group.
Income tax brackets in Ukraine
| Bracket | Rate | Notes |
|---|---|---|
| All taxable income | 18% | Flat rate plus 5% military levy |
Tax rates at a glance
- Flat rate
- 18%All income
- Military levy
- 5%
- Diia PIT
- 5%
- Entrepreneur lane
- 1% / fixed
- General FOP
- 18% + 22% USC
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
EmployeesExpatsContractorsHigh earnersCross-border workers
Watch out for
- Flat 18% excludes the 5% levy everywhere. Every band-free calculation still needs the wartime top-up added.
- Guides quoting 1.5% levy are pre-December-2024. The 5% rate with 2026 extension is the only current figure.
- Refugees keep Ukrainian residence until tie-breaks say otherwise. Host-country concessions mostly expired — model both sides.
- General-system entrepreneurs add 22% social charges. The 18% headline for self-employed excludes the USC layer.
Frequently asked questions
Do expats pay income tax in Ukraine?
Yes, if resident or earning Ukrainian income. Residents pay 18% plus 5% levy on worldwide income with treaty relief.
What is the income tax rate in Ukraine?
A flat 18% plus 5% military levy for 23% combined, with Diia specialists at 5% plus 5%.
How are small businesses taxed in Ukraine?
Simplified entrepreneurs pay UAH 864.70 monthly or 1% of turnover by group, while Diia tech pays 5% plus 5%.
Does the military levy apply to everything?
Nearly: salary, contracts, gains, dividends, rents and inheritances all carry 5%, with reduced rates only for service pay.