The Verkhovna Rada postponed the tax increase for individual entrepreneurs: details of the new bill

On December 4, 2024, the Verkhovna Rada of Ukraine adopted amendments to the Tax Code, which postponed the tax increase for individual entrepreneurs (IEPs) from October 1, 2024 to January 1, 2025. This decision was supported by 288 people's deputies at the parliamentary session, which was an important step for business in the current economic situation.

The changes provide that the introduction of military levy for IEPs will come into force only from the beginning of 2025. Thus, tax obligations for entrepreneurs will be revised, but this postponement gives them additional time to adapt to the new taxation conditions. In addition, this decision also applies to legal entities operating on the simplified taxation system of the third group.

In addition to postponing the tax increase deadlines for individual entrepreneurs, the new bill also includes changes for residents of "Diya City" and their specialists. In particular, for startups that are residents of this program, the norm that did not allow applying the preferential personal income tax rate of 5% and the minimum Unified Social Contribution (USC) is canceled if the number of employees of the startup was less than nine people. However, to prevent abuse, a requirement has been introduced: if a startup does not meet these criteria by the end of the second year of the status of a resident of "Diya City", it will have to pay additional personal income tax and USC.

The changes also include a number of important innovations to support Ukrainian entrepreneurs, in particular, exemption from taxation of capital outflow tax (PnVK) of charitable assistance provided by residents of "Diya City" in favor of the Armed Forces of Ukraine. In addition, the acts of services provided for gig specialists have been canceled, which should contribute to the development of flexible employment and support for specialists working on contract terms.

Special attention was also paid to strengthening the "anti-criteria" for residents of "Diya City" for the period of martial law and the post-war period, which will contribute to clearer and fairer requirements for participants in this program. In addition, it was approved to eliminate some editorial inaccuracies in the legislation regulating the stimulation of the development of the digital economy in Ukraine.

These changes demonstrate the gradual adaptation of tax policy to the conditions of modern economic reality, support for Ukrainian entrepreneurs, as well as ensuring conditions for the further development of innovative startups and digital platforms.