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Due to amendments to the Tax Code of Ukraine, it is worth noting about tax rates and procedures applicable in 2016.
For entrepreneurs of the first and second group the rate of the unified tax is established in the form of percentage of the minimal wage. Thus, the amount of tax for the first group is 10% of the minimal wage, and for taxpayers of the second group is 20% of the minimal wage (as of April 2016, the minimal wage in Ukraine is UAH 1,378 (approx. USD 55)). The unified tax rate is 3% of the income (in case of payment of VAT) and 5% of the income (in case of inclusion of VAT to unified tax). The amount of permitted annual turnover is UAH 5 million (approx. USD 200,000).
Agricultural producers, subject to certain conditions, may become taxpayers of a single tax of the fourth group.
Thus, legal persons have the right to choose the fourth group of the single tax provided that their share of agricultural commodity production in the previous year amounted to at least 75%. This is applicable to:
1) all persons separately, which carry out merger or accession. In this case, it is possible to become a single tax payer in the year of creation, if share of agricultural commodity production obtained for the previous tax year by all commodity producers involved in their creation equals to or exceeds 75%;
2) each individual person created by split-up or spin-off. In this case, it is possible to become a single tax payer from the next year, if share of agricultural commodity production obtained for the previous tax year equals to or exceeds 75%;
3) person created by transformation. In this case, it is possible to become a single tax payer in the year of transformation, if share of agricultural commodity production obtained for the previous tax year equals to or exceeds 75%.
Newly created agricultural commodity producers may be single tax payers from the next year, if share of agricultural commodity production obtained for the previous tax year equals to or exceeds 75%.
For single tax payers of the fourth group the rates depend on the category of land, its location and amounts to (in per cent of the tax base):
Personal income tax and single social contribution
The flat rate of 18% for personal income tax was introduced instead of previous 15% and 20%. As before, the personal income tax rate of 5% is applied to dividends.
There is a flat rate of the single social contribution of 22%. However, the maximum base for the single social contribution is 25 minimum wages.
Corporate income tax
Corporate income tax rate is 18%. In certain cases there are other applicable rates of corporate income tax. Thus, for insurance activities the applicable rate is 3%, for income of non-residents from 0% to 20% and for lottery and gambling as well as betting activities the rate is 10% and 18%.
VAT rate is 20%. For pharmaceutical production there is a special VAT rate of 7%.
Special taxation regime is applicable to the agricultural producers in 2016. The differentiated proportion of declared VAT sums on the special accounts of the agricultural producers and state budget was introduced.
Under transactions with livestock, 20% shall be transferred to the budget and 80% to the special VAT account. Under transactions with grain and industrial crops, 15% shall be credited to the special account of the agricultural producer and 85% to the state budget. Under performance of other transactions with agricultural goods/services, 50% shall be transferred to the state budget and to the special VAT account.
Reform of the tax legislation also envisaged reimbursement of VAT from the state budget, in particular, publication of the official information on reimbursement. Starting from 1 January 2016 there are two registers: for those whose export volume exceeds 40% and all other.
Real estate tax
Concerning the real estate tax, the maximum threshold rate was increased from 2% to 3% of the minimum wage for one square meter of household and/or commercial property, and the additional tax rate in the amount of UAH 25,000 (approx. USD 1,000) was introduced for apartments of more than 300 square meters and houses of more than 500 square meters.
The military duty of 1.5% is effective in 2016.
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