The Law on E-residency Entered into Force, it is planned to restore Taxes in Ukraine, .. 

The Law on E-residency Entered into Force

On 01.04.2023, Law No. 2654-IX On E-residency entered into force providing the possibility for foreigners to conduct business and pay taxes online.

According to the statement of the Ministry of Digital Transformation of Ukraine, as of today, the state authorities are already working on a legal framework that will allow the project to be fully launched. In addition, it is planned to test such a project before foreigners can apply for e-resident status.

Let us please remind you that the Law provides for the possibility for foreigners to:

  • become entrepreneurs in Ukraine “just in a few clicks”,
  • manage their business remotely using modern technologies,
  • sign documents with electronic signatures,
  • remotely open bank accounts and manage them,
  • pay taxes on preferential terms.

According to the Law, entrepreneurs who have income in Ukraine cannot become e-residents. This means that e-residents will be able to provide services exclusively to other foreigners.

Citizens of russia and countries included in the FATF “gray” or “black” list will not be able to become e-residents.

Amendments to the Tax Code of Ukraine regarding Payment Services Entered into Force

On 01.04.2023, Law No. 2888-IX entered into force which amended the Tax Code of Ukraine regarding payment services provisions.

Inter alia, the Law introduces the possibility of using not only accounts opened in banks during settlement transactions and control over them, but also accounts/electronic wallets of a taxpayer in other financial institutions, non-bank payment service providers/e-money issuers.

Also, the Law made changes to the procedure for using a single account. It is determined that the taxpayer’s obligation to pay taxes and fees to the single account is considered fulfilled from the moment when the initiation of the transfer is complete for such a taxpayer in accordance with the Law of Ukraine “On Payment Services”. The Law also stipulates a restriction to accept electronic money on a single account.

Application Forms For State Registration of Legal Entities, Non-profit Organizations and Public Organizations have been Updated

On 29.03.2023, the Ministry of Justice of Ukraine issued Order No. 1158/5, which sets out the application forms for state registration of legal entities, individual entrepreneurs and public organizations, approved by the Order of the Ministry of Justice No. 3268/5 dated 18.11.2016, in a new version.

Updated application forms will enter into force from 1 May 2023.

It is Planned to Raise Taxes to Pre-war Levels and Restore Business Tax Audits

It is planned to restore taxes in Ukraine as they were before a full-scale war starting from July 2023.

The Chairman of the Verkhovna Rada Committee on Finance, Tax and Customs Policy, Danylo Hetmantsev, stated this during the telethon, as Ukrinform reports.

He specified that from July 2023 it is planned to cancel the preferential tax regime for business at the rate of 2% of the turnover, which was introduced in the spring of last year, as well as to restore documentary checks and responsibility for non-fulfillment of tax obligations in those territories, where military actions are not carried out.

Also, as RBC-Ukraine reports, according to Danylo Hetmantsev, from 1 July 2023, VAT on fuel will be restored to pre-war rates – at the level of 20%.

Let us please remind you that in March 2022, the Verkhovna Rada of Ukraine adopted a law that provided for a zero rate of excise duty on gasoline, diesel fuel, and liquefied gas, as well as a reduction of VAT from 20% to 7%.