Starting from 1 October, taking into account 10% of the military tax on the minimum wage, sole proprietors of groups 1, 2 and 4 will have to pay an additional UAH 710 per month. From January 2025 – UAH 800. “KU” figured out what other changes taxpayers can expect after the entry into force of the draft law No. 11416-d.
Managing Partner of Winner Partners Attorneys at Law Serhiy Lytvynenko in an exclusive commentary
“The purpose of the draft law is to improve certain provisions of the Tax Code of Ukraine and to create conditions for the proper functioning of the economy during the period of martial law, as well as to properly fill the budget revenues through tax payments,” – Serhiy Lytvynenko
At the same time, while studying the content of the draft law, lawyers realise that the tax changes are significant.
“We can already conclude that starting from 1 October 2024, businesses in general and, in particular, individual entrepreneurs – single tax payers of the first and second groups (IEs of groups 1 and 2) are expected to face significant tax changes that will affect their financial activities and tax liabilities,” Serhiy Lytvynenko
How and when to pay the military fee
Chairman of the UNBA Committee on Investment and Privatisation, Managing Partner of Evrika Law Andriy Shabelnikov in an exclusive commentary 
“Sole proprietors of groups 1, 2 and 4 will have to pay the military fee no later than the 20th day (inclusive) of the current month. Such taxpayers can pay the military fee in advance for the entire tax (reporting) period (quarter, year), but not more than until the end of the current reporting year,” says Andriy Shabelnikov
Shabelnikov also notes that the increase in the military duty from 1.5% to 5% for employee salaries may cause an additional financial burden for individual entrepreneurs who use hired labour.
The military tax will be introduced on 1 October 2024 and will remain in force until 31 December of the year in which martial law is terminated or cancelled.
How the authorities explain the tax increase
Danylo Hetmantsev, Chairman of the Verkhovna Rada Committee on Tax Policy , explained the need for tax increases. He says that if the budget lacks funds for the main expenditure, financing the army, then every citizen of Ukraine should contribute to its support.
“That is, everyone, you and I, will pay 3.5% more of our income to finance the army. If we talk about controversy, it seems to me that there can only be controversy from the evil one,” Danylo Hetmantsev
In addition, the draft law provides for increased taxes on excess profits of banks, from which the state plans to receive UAH 27 billion. This will be made possible by taxing the income of banks that keep funds in certificates of deposit.
Author – Anastasia Fedor