Regulation Of The Turnover Of Virtual Assets In Ukraine

On 24 April 2025, the Verkhovna Rada Committee on Finance, Taxation and Customs Policy submitted for consideration the revised Draft Law No. 10225-д on the regulation of the turnover of virtual assets in Ukraine.

Earlier, two draft laws were registered on this issue – No. 10225 and its alternative No. 10225-1, which were intended to introduce legal regulation of the turnover and taxation of virtual assets, but differed in their approaches. In particular, the Draft Law No. 10225 proposed a basic concept, integrating the main terms from the current Law of Ukraine “On Virtual Assets,” while Draft Law No. 10225-1 detailed the terminology, in particular, introduced the concept of “service token” and other categories of assets, providing greater flexibility and accuracy in taxation and accounting.

Then, the Committee decided to prepare a revised document as the Draft Law No. 10225-д, which partially combined the approaches of both drafts and introduced new developments.

The key innovations

One of the key innovations is the introduction of a special mechanism for taxation of profits from transactions with virtual assets, similar to the taxation of investment profits, but without the participation of a tax agent. Thus, individuals will have to declare income from the sale of virtual assets and pay personal income tax on it.

At the same time, the document provides for a preferential personal income tax rate of 5% for individuals who sell assets acquired before the Draft Law comes into force.

Another important change is the introduction of mandatory registration of virtual asset service providers working with Ukrainian residents. They will be required to register with the tax authorities and report on their activities annually.

Penalties are also envisaged for failure to fulfil these obligations — however, they will be reduced during the transition period:

in 2026 — 10% of the established fine
in 2027 – 2029 — 25% of the established fine

Legal entities will have to apply the new differences to adjust their financial result in a manner similar to how securities transactions are taxed.

At the same time, transactions on the issue (emission), placement in any form of management, sale, exchange, redemption of virtual assets (except for the sale and exchange of NFTs and virtual assets that certify the right to demand the transfer of property or the provision of services, as well as services of service providers related to the turnover of virtual assets (excluding consulting services, which are taxed on a general basis)) will not be subject to VAT.

A transitional period

In the event the draft law is adopted, its provisions will come into force on 01 January 2026 with a transitional period during which the mitigated requirements for market participants will apply.

One of the peculiarities of the transitional period provided for in Draft Law No. 10225-д is the temporary recognition of tokens issued in the so-called “trusted countries” as equivalent to virtual assets issued in Ukraine.

For three years from the date of entry into force of the law, asset-linked tokens, e-money tokens, and other types of virtual assets issued in the EU, the UK, the US, Canada, Japan, Korea, Australia, New Zealand, Norway, Switzerland, or Singapore will be deemed to have been created in Ukraine. These terms are intended to simplify the legal recognition of foreign virtual assets and facilitate their circulation within the Ukrainian legal framework at the initial stage of the draft law’s implementation.

We will continue to closely monitor further developments in the status of this Draft Law and report on them in the future Legal News.