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Потрібна допомога адвоката? Залишай заявку QES in Ukraine is moving to a new level of security: from 10 February 2026 all new keys will be created using the strengthened “Kupyna” algorithm, and a full transition to this standard is expected by 1 July 2026. For users this means not so much a change in familiar services as an update of the “engine room” – the cryptography will become much more resistant to modern cyberthreats and digital data will be better protected. What exactly is changing in the rules for creating QES From 10 February 2026 all new QES certificates will be generated with the “Kupyna” algorithm – a modern cryptographic standard that replaces previous algorithms for new operations. The old algorithms will not be switched off instantly: they will continue to be used to verify documents signed earlier, but for new keys and transactions only “Kupyna” will gradually be applied. The Ministry of Digital Transformation has set a deadline: by 1 July 2026 all providers of electronic trust services must fully migrate to the new standard, synchronising their hardware‑software complexes and internal regulations. For users this is a planned security upgrade: the interfaces of Diia, the tax e‑cabinets and banking apps remain the same, only the way cryptographic keys are generated and stored changes. Do you need to urgently replace your current signature All QES issued before 10 February 2026 remain valid until their expiry date – no automatic “cancellations” or blocks are envisaged. If your certificate is valid for a few more months or a year, you can safely use it for tax reporting, submitting applications via Diia, participating in tenders or conducting banking operations until it expires. The old encryption algorithms will continue to be supported for signature verification – documents you have already signed with an “old” QES will not lose legal force and will be correctly verified in state systems. You will actually switch to the new standard during scheduled renewal: when the certificate expires, the certification centre will issue you a new key already based on “Kupyna”, without any extra actions on your part. Benefits and risks for ordinary users The main benefit is an increased level of cyber protection: the strengthened algorithm reduces the risks of key guessing, signature interception and unauthorised modification of signed data, which is especially important given rising computing power and attack sophistication. For an ordinary user this looks like a “lock upgrade” – the signing process in Diia or the taxpayer’s cabinet does not change, but the likelihood of a technical compromise of the key itself drops significantly. Stronger signatures reduce fraud risks: it becomes harder for attackers to create a fake QES, take out loans, file a bogus tax return or sign documents on your behalf without access to the real key. At the same time, the cost of careless handling of QES increases: if a user passes the key to third parties, stores the password in plain text or uses dubious devices, the consequences of compromise will be just as serious as before, and proving a hack without proper logs and a well‑organised key management process will be difficult. Implications for businesses and sole proprietors For small and medium‑sized businesses the new rules mean that all future signatures of employees, accountants and directors will gradually move to a single strengthened standard, which will simplify interaction with public authorities and counterparties in the long term. However, during the transition companies will need resources for an inventory of existing QES, scheduled reissuance of certificates, updating internal information‑security policies and training staff who use e‑signatures in their daily work. In sensitive sectors – public procurement, finance, work with state registers – regulators may insist on using secure hardware tokens or cloud‑based QES with strict access control, which will add costs but reduce the risks of internal abuse. For businesses working with non‑residents and international partners, the transition to a modern standard increases the chances of further technical and legal convergence with the European eIDAS infrastructure and thus simplifies electronic document exchange with EU counterparties. How to prepare for the transition: step‑by‑step tips Check the expiry date of your current QES certificate in your trust service provider’s cabinet or in the app you use and note that date – this is your control point for migrating to “Kupyna”. Monitor announcements from your certification centre: during the transition there may be changes in working hours, issuance channels, required documents or service fees, which is crucial if you are responsible for multiple employees’ signatures. Decide on the key carrier format: for individuals and some sole proprietors a file‑based or cloud QES may be sufficient, whereas for public officials, managers of large companies or those responsible for procurement it is more appropriate to use secure tokens with limited physical access. Update basic cyber‑hygiene rules: never share keys, do not store passwords in unprotected notes, use multi‑factor authentication for access to Diia, e‑cabinets and email through which you receive confirmations of QES operations. If you run a business, create an internal register of all QES (who uses which signature and for what), define a procedure for urgent blocking of a compromised key and designate responsible persons employees should contact if a token is lost or a hack is suspected. If you have questions or face difficulties related to transitioning to the new QES standard, choosing a secure signature carrier, organising key management in your company or dealing with the consequences of a possible key compromise, seeking qualified legal and tax advice will help you choose the best operating model, minimise technical and legal risks and avoid disputes with counterparties and regulators. Author – Yuliia Popadyn, attorney of the tax and housing law practice at the Law Firm “Winner Legal Company”. https://www.youtube.com/watch?v=O8bzVJTBOe8&t=3s

Потрібна допомога адвоката? Залишай заявку Tax evasion through artificial “splitting” of business into sole proprietors has ceased to be a grey area: the tax service, the Bureau of Economic Security and financial monitoring bodies openly state that they treat such models as deliberate tax evasion with a high risk of additional assessments and criminal liability. What is business “splitting” via sole proprietors?The scheme works by artificially dividing a large or medium‑sized business into dozens or even hundreds of sole proprietors on the simplified tax regime who do not exceed their income limits; instead of a single legal entity paying corporate income tax and VAT, all operations are routed through a network of related entrepreneurs, often de facto employees of the same company.By doing so, the company: avoids registration as a VAT payer; pays the single tax instead of corporate income tax; reduces payroll tax burden by disguising employment as civil‑law contracts.The tax authorities clearly state that such structures have no genuine business purpose and are used solely to minimise tax liabilities, and therefore are treated as tax evasion. How the tax authorities detect splitting schemesOver the past year, the State Tax Service has publicly reported uncovering splitting schemes in a number of major retail chains — from electronics and clothing to food. In some cases, the potential budget losses were estimated in hundreds of millions or even billions of hryvnias of VAT and other taxes.Key analytical red flags monitored by the tax service and financial intelligence include: artificial division of a single business into many sole proprietors with the same type of activity; trading under a single brand with one signboard, marketing strategy and pricing; identical IP addresses, common registration addresses, the same retail outlets and staff; use of one payment terminal or cash register for several sole proprietors; gradual “on‑boarding” of new sole proprietors as previous ones approach their income limit; concentration of revenue from one or a few major customers, with no own resources, warehouses or staff.On‑site inspections confirm the analytics: inspectors record situations where identical goods in one store are sold on behalf of different sole proprietors, receipts do not match the real transaction, and the business is managed centrally. What risks business splitting entailsFor companies using such constructions, the consequences go far beyond extra single tax assessments: additional VAT and corporate income tax with re‑qualification of transactions and loss of simplified regime; fines and interest for underpaid taxes over the entire period the scheme operated; re‑classification of civil‑law contracts as employment, with extra PIT, social contributions and labour‑law fines; initiation of criminal proceedings under Article 212 of the Criminal Code of Ukraine (tax evasion) where significant budget losses are involved; for “nominal” sole proprietors — the risk of personal tax debts, frozen accounts and liability for participation in sham schemes.In public cases, the state stresses that the fight against splitting is not an attack on small business, but a response to large chains and companies that disguise themselves as sole proprietors to save on VAT and corporate income tax. Where is the line between optimisation and evasion?Cooperation with sole proprietors is lawful as long as they remain independent entrepreneurs rather than “tax conduits”.Signs of a safer model include: the contractor has several clients and its own resources (office, equipment); the contract sets a market‑level price and a real scope of work; there is no full dependence on a single client in terms of schedule, workplace and managerial control (no de facto employment).For family businesses, kinship between sole proprietors is not a violation in itself, but a shared brand, tills, staff and counterparties taken together point to artificial splitting.In the IT sector, regulators increasingly recommend using more transparent special regimes such as Diia.City instead of mass engagement of contractors as sole proprietors. How to reduce risks for businesses working with sole proprietorsIn practice, a “safe” cooperation model with sole proprietors requires a systemic approach to structuring business processes. Experts advise to: limit the number of sole proprietors, especially where the business operates under one brand and in the same locations; document the economic substance of each contract with a sole proprietor, including their own resources, clients and risks; avoid sharing cash registers, POS terminals and bank accounts between different entities; carry out internal tax audits to ensure the model reflects genuine business activity rather than a tax‑evasion scheme; keep track of court practice and public positions of the tax service and the Bureau of Economic Security, as risk criteria are constantly being refined.For many large businesses, using dozens of sole proprietors no longer justifies the risk: potential additional assessments, penalties and criminal exposure outweigh any tax “savings”.If you have questions or issues related to your tax model involving sole proprietors, possible signs of business splitting or the risk of additional assessments and criminal liability, seeking qualified legal and tax advice will help you restructure your business in time and protect it from claims by supervisory authorities. Author – Yuliia Popadyn, attorney of the tax and housing law practice at the Law Firm “Winner Legal Company”. https://www.youtube.com/watch?v=O8bzVJTBOe8&t=3s

Потрібна допомога адвоката? Залишай заявку How you obtain information about your income from the State Register of Individuals – Taxpayers depends on whether you are comfortable using online services or prefer visiting the tax office in person. Below is a step‑by‑step guide to the main options: through the Taxpayer’s Electronic Cabinet, the STS mobile application, the Diia portal and the Taxpayer Service Center. Why you need income informationThe data obtained are used: to complete the annual income and assets tax return (including for a tax rebate); to confirm income to a bank, employer, consulate, etc.; to check whether employers have correctly reported your income and taxes; to prepare for e‑declaration for public officials.The information is generated from the State Register and is the official record of income accrued to you, as well as personal income tax and military levy withheld. Online method No. 1: Taxpayer’s Electronic CabinetThis is the basic online tool of the State Tax Service that can be used by all individual taxpayers. Step 1. Log in to the CabinetGo to the website of the Electronic Cabinet of the STS.Log in using a qualified electronic signature (file/hardware key or cloud storage), the id.gov.ua service or Diia.Signature. Step 2. Creating a requestIn the left‑hand menu select “EC for citizens”.Find the service “Request for amounts of paid income”.Click “Create” (or “+”), select the tax period (year, and, if needed, several years).Check that your personal data have been pulled through correctly and sign the request with your e‑signature. Step 3. Receiving the responseWithin a few minutes the response appears in the “Incoming/Outgoing documents” section of your Cabinet.You can open the extract, download it as a PDF or print it.The advantages of this option are its speed (often within 10–15 minutes) and the ability to submit a request at any time without visiting the tax office. Online method No. 2: STS mobile applicationMany taxpayers use smartphones, and the tax service offers a mobile app (“My Tax” or another official application). Step 1. Installation and loginDownload the app from the App Store or Google Play (make sure it is an official STS product).Log in using an electronic key or cloud‑based signature. Step 2. Requesting informationOpen the “Services” section.Select “Request for amounts of paid income”.Create a request, specify the required period and sign it with your QES. Step 3. Viewing the resultThe response is generated within a few minutes and becomes available in a separate section of the app.If needed, the document can be exported and sent to your email.This channel is convenient if you work from your smartphone a lot and want to keep the certificate at hand. Online method No. 3: Diia portal (income certificate)Through Diia you can order a separate income certificate from the State Register of Individuals. Step 1. AuthorisationLog in to your citizen account on the diia.gov.ua portal using an e‑signature or BankID. Step 2. Ordering the certificateFind the service “Income certificate”.Select the period (years) for which you need information.Submit the request and confirm the action. Step 3. Receiving the certificateWithin roughly 30 minutes you will receive a notification that the document is ready.The certificate will appear in the “Documents” section of your account; you can download it as a PDF or show it directly from your phone.This certificate is convenient for submission to banks, social protection authorities, educational institutions or employers because it has a standard format and electronic details. Offline method: Taxpayer Service Center (TSC)If you do not have an e‑signature or internet access, or simply prefer face‑to‑face communication, you can apply to a TSC. Step 1. Preparing documentsIdentity document (passport, residence permit or other document provided by law).Taxpayer registration number (TIN).If a representative applies on your behalf, a notarised power of attorney is required. Step 2. Submitting an applicationAt the TSC you fill in application form No. 10DR (request for information from the State Register on sources/amounts of income, tax and military levy).Choose the period for which you need the data (you can usually specify several years). Step 3. Processing time and form of issueInformation is provided within up to 3 working days from the date of application.The document is issued to you personally or to your representative (under a power of attorney).TSCs usually offer additional options for people with hearing impairments (video link with a sign‑language interpreter, etc.), so it is worth clarifying what is available at your local tax office. What to check in the income extractRegardless of how you obtain it, carefully review: whether all your employers for the selected period are listed as sources of income; whether the amounts match the certificates issued by employers and the money actually received; whether the amounts of personal income tax and military levy withheld are shown correctly; whether there are any “extra” incomes that were not actually accrued to you (sometimes this is due to a counterparty’s error or duplicate entries). If discrepancies are found, you should: contact your employer/tax agent to correct the tax reporting; if necessary, seek additional advice from the STS or a tax consultant. Practical tips for taxpayers Request your income information in advance so you have time to correct possible errors. Store the downloaded PDF extract in a secure place (cloud storage or encrypted drive). For the annual tax return, request data for the calendar year only. Monitor the deadlines for filing returns: for most individuals the final date is in spring of the following year, for civil servants it is earlier, and a return to claim a tax rebate can be filed until year‑end. If you have questions or encounter difficulties with obtaining income information, correcting errors in the data or correctly reflecting these amounts in your tax return, seeking qualified legal or tax assistance will help you avoid financial and reputational risks. Author – Yuliia Popadyn, attorney of the tax and housing law practice at the Law Firm “Winner Legal Company”. https://www.youtube.com/watch?v=O8bzVJTBOe8&t=3s

Потрібна допомога адвоката? Залишай заявку The Verkhovna Rada once again failed to move forward with the legislative initiative known as the “OLX tax”: the government’s draft laws on taxing income received via digital platforms (No. 14025 and its related bill No. 14026) once again did not secure the required 226 votes even to be added to the agenda. Political context of the failureKey votes on the “OLX tax” in late 2025 and early 2026 kept stalling at the stage of adding the bill to the agenda: some MPs do not want to take responsibility for unpopular tax changes during wartime, while others insist on further refining the model to protect small businesses and occasional sellers, even though the government and the relevant committee point to Ukraine’s international obligations to the EU and OECD to introduce automatic exchange of income data from digital platforms. Essence of the initiative: who and how was to be taxedDraft law No. 14025 proposed to make marketplaces and services (OLX, Prom, Rozetka, Bolt, Uber, Airbnb, Booking, Glovo, etc.) tax agents that collect data on users’ income and withhold tax from it, setting a tax‑free threshold of 2,000 euros for occasional sales and, for higher amounts, a rate of 5% personal income tax plus 5% military levy (with a further increase to 18% + 5% for income above UAH 6.6 million), which, according to government estimates, was expected to bring the budget about UAH 14 billion per year. Why people talk about an “OLX tax” even though it already existsFormally, income from systematic online sales is already subject to taxation at rates of 18% personal income tax and 1.5% military levy, but most transactions remain “invisible” to the tax authorities because the money goes to regular bank cards and sellers do not register as sole proprietors or file tax returns. The “OLX tax” does not introduce a new levy but changes the administration mechanism: platforms become tax agents that automatically withhold 10% from payments to active sellers and report to the State Tax Service, banks open separate accounts and share information on such transactions, and the media label arose precisely because the initiative is tied to specific platforms. Arguments for and againstSupporters of the bill stress three key arguments: creating a level playing field between traditional businesses (sole proprietors and legal entities that pay taxes and use cash registers) and the “grey” online trade operating without registration; meeting international requirements on automatic exchange of tax information, without which Ukraine risks being put on “grey lists”; additional budget revenues, which are especially important during the war. Opponents focus on the risks of excessive control over ordinary citizens who occasionally sell personal items, as well as on the technical and financial burden on the platforms themselves, the banking sector and the State Tax Service. There are concerns that, due to the complexity of the procedures, some small sellers will go into the shadow economy or switch to cash payments or foreign services, which would undermine the reform’s effect. Why the vote keeps failingDespite the support of the relevant committee, the plenary hall repeatedly lacks enough votes even to put the bill on the agenda: some factions demand broader public discussion, clearer non‑taxable thresholds and safeguards for occasional sellers. The situation is complicated by the fact that the “OLX tax” is bundled with other sensitive financial laws as part of agreements with the EU and IMF, so the failure of one issue drags down the entire package, and MPs are reluctant to take reputational risks by voting for an initiative that society perceives as a “tax on the classifieds board”, even though formally it applies only to systematic sellers and large volumes of income. What the latest failure means for sellers and buyersAs long as the law is not adopted, the taxation rules remain unchanged: one‑off sales of personal items (clothes, electronics, furniture) without signs of business activity are hardly monitored, although in theory such income is subject to declaration; systematic sellers and those who earn money on marketplaces as a business are legally required either to register as sole proprietors or declare their income as self‑employed persons, but in practice a significant part of this income remains in the shadow economy. For marketplaces, another postponement means there is still no obligation to implement complex tax and compliance processes, but it also means continued uncertainty: Ukraine still has to implement international standards for information exchange, so the political question of “when and in what form” is merely pushed back in time. If you have questions or issues related to taxation of income from online trade, working through marketplaces or preparing for the possible introduction of an “OLX tax”, seeking professional legal and tax advice will help you choose a safe business model and assess potential risks in advance. Author: Ihor Yasko, Managing Partner at JSC “WINNER Law Firm”, PhD in Law. https://www.youtube.com/watch?v=O8bzVJTBOe8&t=3s

Потрібна допомога адвоката? Залишай заявку The 2026 e-declaration campaign is taking place under updated NACP clarifications, which significantly refine the approach to reporting assets, income and transactions, and also take into account new social benefits and the practice of previous years. Below are seven key changes that every declarant should consider when completing the declaration for 2025. Updated general clarifications and structure of examplesThe NACP has updated the basic clarifications for the 2025 declaration campaign, added new examples and “key points”, and placed special emphasis on reporting financial liabilities, expenses, transactions, as well as operations with real estate, vehicles and monetary assets. Social benefits “National Cashback” and “Winter Support”The NACP clarifications separately address the new income types “National Cashback ‘Made in Ukraine’” and “Winter Support”: since 25 December 2025 the Register automatically pulls in the source of income for these payments, which technically simplifies declaration but requires the declarant to verify the correctness of the data; such amounts must be reported as state income with the correct type of income and source in order to avoid discrepancies or complete non‑reporting of these payments in the declaration. More detailed rules for declaring property and transactionsThe updated NACP materials explain in detail how to declare transactions, expenses and financial liabilities, supplementing the clarifications with practical case studies (purchase/sale of real estate, mortgages, cars, major cash payments, deposits) and clearly indicating when a transaction is treated as an expense and when it is a liability; separate guidance is provided on co‑ownership to ensure that declarants correctly report their shares in property and do not confuse the full value of an asset with their own share, thereby reducing the risk of the data being treated as inaccurate. Focus on monetary assets and declaration thresholdsThe clarifications and additional NACP information materials specify the thresholds from which monetary assets must be declared and when a notification of significant change in financial status is required. For 2026, the total amount of monetary assets subject to disclosure (cash, funds on accounts, e‑money, etc.) must exceed 50 subsistence minimums for able‑bodied persons — UAH 166,400 as of the end of the reporting period.It is also reiterated that a notification of a significant change in financial status must be filed if the declarant receives income, acquires property or makes an expenditure exceeding the same threshold of UAH 166,400, and this must be done within 10 days from the date of the transaction. These clarifications aim to eliminate the common mistake when declarants rely on outdated thresholds or “round” amounts, assuming that certain transactions may be omitted. Opening foreign currency accounts and foreign exchange operationsAnother block of the updated clarifications concerns foreign currency accounts in non‑resident banks and foreign exchange operations. The NACP reminds that declarants are obliged to submit a special notification about opening such an account in a foreign bank within 20 days from the opening date or from the day they became aware of the account. This obligation exists in parallel with filling out the relevant section of the declaration, where such accounts and the funds on them must also be reported.The updated materials also detail how to declare funds held abroad, how to correctly reflect transfers between accounts in different currencies, exchange rate differences and other typical situations for public officials who have income or assets outside Ukraine. Clearer guidance reduces the risk that failure to declare foreign accounts will be justified by “misunderstanding” the rules. Clarifications on the scope of declarants and when to fileThe NACP’s communication materials for the 2026 campaign once again stress who is required to submit an annual declaration for 2025 and in which cases a declaration is not required. The declaration campaign for public officials runs until 31 March 2026 inclusive; it applies to persons defined in Article 3 of the Law “On Prevention of Corruption” who held the relevant positions at the end of 2025 or ceased to hold them during the year.The clarifications also include specific guidance for special categories — military personnel, mobilised staff of public authorities, persons on parental leave or in prolonged absence due to the war. For some of these individuals, deferrals or simplified procedures apply, but the NACP recommends that, in case of doubt, they contact the relevant anti‑corruption officers or consult the Knowledge Base for individual clarifications. New formats of methodological support and webinarsFor 2026 the NACP has supplemented its clarifications with an expanded package of methodological materials (step‑by‑step guides, videos, online tools) that are freely available in the Knowledge Base and on the training platform, and has also organised a series of webinars “Electronic Declaration 2026”, where experts explain common mistakes, provide practical advice and describe how automated control, checks and further NACP actions work after a declaration is submitted.If you have questions or issues related to filing your e‑declaration for 2025, interpreting the updated NACP clarifications or assessing the risk of liability for possible errors, seeking qualified legal assistance will help protect you from violations and reputational consequences.Author: Ihor Yasko, Managing Partner at “WINNER Law Firm”, PhD in Law. https://www.youtube.com/watch?v=zijqlf6Oa1E&t=8s

Потрібна допомога адвоката? Залишай заявку Counterparty checks today are no longer “box‑ticking bureaucracy” but a basic condition for business security, tax benefits and the owner’s peace of mind. Below is a news‑and‑expert overview of key risks and tools, and how the WINNER team helps to manage them systematically. Why this topic is “hot” again The tax authority continues to build a risk‑based approach: cooperation with “problem” counterparties is becoming an independent ground for disputes, additional assessments and blocking of tax invoices. Court practice has confirmed that proper tax due diligence is a lawful precondition for obtaining tax benefits, in particular for VAT and expenses. Since 24.02.2022 a counterparty’s links with the aggressor state or its residents have become a separate risk factor – this now entails not only tax, but also security consequences. Example: a properly documented counterparty check often becomes a decisive argument in a dispute with the tax authority about the reality of transactions and the right to a tax credit. Key risks when choosing a counterparty Fictitious or “technical” counterparty: no real office, staff or assets, unclear business activity, frequent changes of directors/founders. Tax riskiness: inclusion of the counterparty in the list of “risky” taxpayers, mass suspension of tax invoices, mismatch between resources and transaction volumes. Debts and enforcement proceedings: data from the Unified Debtors Register and the Automated Enforcement System indicate poor payment discipline and a high risk of non‑payment. Sanctions‑ and war‑related risks: ties to Russia/Belarus among beneficiaries or management, which may trigger questions from the security service, investigative bodies and financial monitoring. Reputational risks: media publications, court disputes, conflicts with state authorities, bringing officials to liability. Even a single “red flag” without explanation and documentary confirmation can destroy the business’s position in a tax dispute. Tools and sources for checks Taxpayer’s e‑cabinet: the State Tax Service’s tool for checking VAT payers’ risk status and their registration standing. State registers: the companies register, Unified Debtors Register, court register, licensing registers, sanctions lists and registers of persons linked to the Russian Federation. Commercial analytical systems: services such as YouControl consolidate indicators of “proper tax due diligence” and aggregate financial, tax and legal risks. Internal procedures: due‑diligence checklists, questionnaires for counterparties, requests for corporate, registration and financial documents. It is precisely a systematic approach (combining open registers, services and internal policies) that demonstrates proper due diligence in a dispute with supervisory authorities. What the tax authority requires as “proper due diligence” Building an evidence base: documents confirming that you checked the counterparty’s status, resources, signatory’s powers and the reality of the transaction. Tax‑risk analysis: a risk‑oriented approach under which the business identifies, assesses and documents risks for each material transaction or group of counterparties. Consistent internal rules: a counterparty‑check policy approved by management, plus documented decisions explaining why cooperation was approved or declined. Courts explicitly note that if a taxpayer has collected and retained adequate evidence of due diligence, it becomes much harder for the tax authority to prove that they acted “unreasonably” or “in bad faith”. How WINNER helpsWINNER can act as an external “safety filter” for your transactions with counterparties – from one‑off checks to building a full‑scale due‑diligence system. Main service formats: Comprehensive “deal‑specific” counterparty review: analysis of state registers, tax risks, court disputes, sanctions and links to the aggressor state, with a structured conclusion and recommendations (to contract or not, and which safeguards to include in the agreement). Building a tax‑due‑diligence policy: drafting internal regulations, checklists, decision templates and contract clauses that protect the business during audits. Support in tax disputes: using the accumulated due‑diligence evidence when appealing blocked tax invoices, additional assessments and in court proceedings. Team training: practical workshops for accounting, legal and sales teams on “red flags” and proper documentation of counterparty checks. If you have any questions or issues related to counterparty checks, tax risks, or building a system of proper tax due diligence, please seek professional advice. Author: Ihor Yasko, Managing Partner at JSC “WINNER Law Firm”, PhD in Law https://www.youtube.com/watch?v=zijqlf6Oa1E&t=8s

Потрібна допомога адвоката? Залишай заявку The discussion on introducing mandatory VAT payments for sole proprietors (FOPs) has gone beyond a purely tax issue and has become one of the key topics in Ukraine’s cooperation with the IMF. The Fund sees this change as a way to broaden the tax base, strengthen the fight against tax evasion, and bring the system closer to a more “mature” model of business taxation, while for entrepreneurs it looks like a threat to the simplified tax regime. Why the IMF is interested in FOPs at all.  The IMF is interested in FOPs because it aims for balanced public finances and a transparent, efficient tax system. In Ukraine, FOPs of groups 2–3 are used both as an entrepreneurship tool and as an optimization scheme for large businesses that transfer employees to FOP contracts. This “grey” area has attracted the IMF’s attention, and among the prior actions under the new program, Ukraine committed to broadening the tax base by introducing VAT for part of the FOPs and taxing income from digital platforms. The idea is that a significant share of economic activity is hidden within high‑turnover FOPs and falls out of the full cycle of VAT and income taxation. Essence of the requirement: what the IMF expects.  The first public signals concerned the introduction of mandatory VAT for FOPs whose annual turnover exceeds approximately UAH 1 million. According to statements by politicians and media reports, the publication of a government bill with such a provision, its registration in the Verkhovna Rada, and its adoption within specified timeframes were defined by the IMF as key prior steps for unlocking more than USD 8 billion in financing. The basic idea is as follows: FOPs with an annual turnover of over UAH 1 million are required to register as VAT payers. The VAT rate is 20%, as for other taxpayers. The requirement is planned to take effect not immediately, but from 2027, so that businesses have time to adapt. The IMF insists on clear criteria for determining employment relationships so that employers cannot disguise employees as FOPs when there is in fact an employment relationship. In addition, it is proposed to broaden the tax base by taxing income from online platforms and reducing customs “loopholes”. What is already known about Ukraine’s position.  The Ukrainian government and parliament have found themselves caught between two fires: on the one hand, the critical need for financing from the IMF and other donors, and on the other, the risk of a serious blow to small businesses. According to media reports and industry publications, the government is trying to soften the IMF’s initial requirements, in particular regarding the turnover threshold and the strictness of the approach. There are several avenues for maneuver: Increasing the turnover threshold (for example, significantly above UAH 1 million) so that the obligation covers only genuinely “medium‑sized” businesses rather than small entrepreneurs. Introducing simplified VAT administration regimes for FOPs (for example, special reporting forms, less frequent filing of VAT returns). Phasing in the reform by defining a transition period so that businesses have time to change their operating model, contract structures, and pricing. At the same time, some sources already report that the Ukrainian side is trying to exclude or dilute as much as possible the most stringent obligations on mandatory VAT for FOPs from the final text of the updated Memorandum. However, until the document is published, it remains unclear how successful these negotiations will be. How this could change the work of FOPs.  The introduction of mandatory VAT for FOPs with a certain level of turnover is not just “an additional tax” but a complete change in the logic of how they run their business. First, this means: keeping detailed records of transactions, registering tax invoices, filing monthly VAT returns. FOPs that currently operate under the single tax regime (5% of turnover plus the military levy) will in fact be forced either to raise prices by passing the 20% VAT on to the client or to reduce their margin. For those who sell goods or services to business clients that are VAT payers, the situation may be relatively neutral, since their counterparties will be able to claim this VAT as input tax. But for those who work with the end consumer (B2C), the hit to demand or profitability may be significant. Second, part of the FOPs will face a choice: switch to the general tax system with VAT and operate as “small businesses” in the classical sense; change their business model (reduce turnover, split the business, go into the shadow economy); close their FOP and take up employment as hired workers. Business associations and experts warn that a strict introduction of VAT with a low turnover threshold may lead to mass closure of FOPs, increased informality, and a reduction in self‑employment. In contrast, the IMF and some reform advocates expect that this will eliminate purely tax‑optimization schemes and incentivize more transparent employment. Impact on the labour market and “FOP‑employment”.  A separate dimension is the labour market. In parallel with VAT for sole proprietors (FOPs), the IMF insists on introducing criteria that would allow supervisory authorities to qualify the relationship between a company and a FOP as an employment relationship. If these criteria are clear and strict, the classic “staff on FOPs” model (especially in IT, marketing, creative industries, logistics) will become significantly more expensive and risky for businesses. For many specialists this means: higher chances of being formally employed on staff (with all social guarantees, but also with higher tax withholdings), a reduction in formal “entrepreneurial” freedom, a potential decrease in net take‑home income in case of transition to the classical salary model. At the same time, the state expects to receive: higher revenues from social security contributions (ESV), personal income tax (PIT) and the military levy, more level playing field between “white” employers and those who massively use “FOP schemes”. Are there alternatives to a hard‑line scenario.  The question is not whether there will be tighter control over

Потрібна допомога адвоката? Залишай заявку The statement by the head of the Parliamentary Finance Committee, Danylo Hetmantsev, that “it is an absolute anomaly when the number of sole proprietors (FOP) increases during a war” has sparked an active debate among experts and business: at first glance, the rise in entrepreneurship against the backdrop of falling GDP looks like a sign of economic flexibility, yet Hetmantsev himself explains this trend primarily by the expansion of shadow schemes and tax minimization rather than by any real economic miracle. The phenomenon of “plus 200,000 FOPs” amid economic declineAccording to Hetmantsev, during the full‑scale war Ukraine’s economy has contracted significantly, and even under an optimistic recovery scenario it will return to the 2021 level only around 2038, so the increase of about 200,000 FOPs is, in his view, “an absolute anomaly”, since an expansion of entrepreneurship is usually expected in a growth phase, not a recession. Statistics show that in just the second year of the full‑scale war about 315,000 new FOPs were registered – a record for the past decade – bringing the total number close to 2.2 million, with constant migration between opening and closing. On the one hand, this demonstrates the adaptability of Ukrainians who, after losing their jobs or relocating, move into self‑employment; on the other hand, the sharp surge against the backdrop of a shrinking economy indicates that a significant share of new FOPs is linked not to new business projects, but to shifting existing schemes onto the simplified tax system. “Business splitting” as the main explanationHetmantsev explains the “anomalous” growth in FOPs primarily by the splitting of medium and large businesses into networks of formally independent sole proprietors in order to reduce the tax burden and avoid VAT: a large share of new FOPs, he argues, is not genuine small business but a tax‑optimization tool for major players. Even before the war, the practice of “salary FOPs” – when employees are formally registered as sole proprietors to avoid paying the full tax package on wages – was heavily criticised, and the full‑scale invasion has only intensified this logic, as businesses under cost pressure look for legal, albeit controversial from the standpoint of tax fairness, ways to cut taxes. The structure of new registrations also supports the “schematic” nature of part of the FOP boom: among the most common activity types are online retail and IT services, where large marketplaces and service companies often reassign parts of their operations and staff to FOPs while retaining actual control over business processes. Is FOP growth really a threat rather than an opportunity?This raises the question of whether the increase in FOP numbers is unequivocally negative: formally, FOP status is a legal form of entrepreneurship that allows people to work “in the open” and pay taxes (albeit lower than large companies), so registering as a FOP is still preferable to fully shadow incomes or labour migration. At the same time, Hetmantsev criticizes not so much “classic” small entrepreneurs as the systemic distortion whereby a large part of the tax base is concentrated in the simplified regime, where the tax is only weakly linked to real margins and turnover, thereby constraining the budget’s ability to finance defence and social spending during wartime. Moreover, the mass use of FOP‑schemes for optimisation creates unequal playing conditions: companies on the general system with full VAT and corporate income tax face a competitive disadvantage compared with those that formally “split” their activities among dozens of FOPs, which leads not only to revenue losses but also to distortions in market structure and investment incentives. The state’s stance: de‑shadowing instead of “hunting FOPs”Hetmantsev emphasises that the goal is not to “tighten the screws” on all FOPs or to change the single tax before the war ends, but to target “salary” and “schematic” FOPs used by big business for systematic tax evasion. In effect, the state is proposing a renewed “social contract”: a future reduction in the overall tax burden in exchange for businesses abandoning shadow practices, but delivering on this approach requires greater trust in institutions, transparent rules and predictable enforcement – all of which are still lacking, so entrepreneurs continue to prefer the most flexible and “safe” FOP format. What conclusions should business draw?The key signal for business is straightforward: the era of consequence‑free splitting schemes disguised as small business is ending, and tax authorities are increasingly scrutinising payments, interaction with FOPs and the real substance of operations. Small entrepreneurs who genuinely run their own businesses should distance themselves as far as possible from the “schematic” segment – by maintaining transparent accounting, proper documentation and a clear economic rationale. Medium and large businesses should already be reviewing their FOP‑based structures and modelling scenarios in which part of their operations is moved onto the general tax regime. In the coming years, the main trend is likely to be not the mass liquidation of FOPs, but a gradual convergence of tax rules across business forms and tighter control over large turnovers on the simplified system; for those who adapt early to more transparent standards, this transformation may open up better access to financing, government programmes and partnerships. If you have questions or face challenges related to choosing the optimal legal form for your business, structuring relations with sole proprietors, de‑shadowing operations, managing tax audits or minimising fiscal risks, you should seek professional advice. Author: Ihor Yasko, Managing Partner at JSC “WINNER Law Firm”, PhD in Law. https://www.youtube.com/watch?v=O8bzVJTBOe8&t=2s

Потрібна допомога адвоката? Залишай заявку Detinization of the household appliances and electronics market is already delivering a tangible fiscal and behavioral effect: both official revenues and the number of fiscal receipts are increasing, while businesses are gradually shifting towards more transparent models of operation. Exiting the “grey zone”: key figuresAccording to the State Tax Service (STS), in just four months of 2025 official revenues from the sale of appliances grew by 53.4%: from UAH 15.3 billion in September to UAH 23.5 billion in December 2025. In monetary terms, this is an increase of UAH 8.2 billion, which clearly indicates the legalization of a significant share of previously “shadow” sales.The number of fiscal receipts in December 2025 reached 8.2 million, which is 1.6 million or 23.7% more than in September. At the same time, the average amount per receipt increased by 24% – up to UAH 2.9 thousand, indicating not only greater fiscalization of small sales but also the “whitening” of higher‑priced product segments. Institutional drivers of detinizationA significant detinization effect was ensured by a change in the state’s approach: instead of a purely punitive model, the emphasis was placed on a combination of control and systematic dialogue with business, which was formalized during a coordination meeting of the STS, Bureau of Economic Security, State Financial Monitoring Service and major retail chains in 2024. At the same time, practical control was strengthened: in 2025 thousands of on‑site inspections were carried out, resulting in hundreds of millions of hryvnias in fines, which created a strong financial incentive to abandon trading without cash registers (RRO/PRRO), “business splitting” and the use of pseudo‑fiscal receipts. Tax burden and labour marketDetinization has also affected the tax efficiency of the sector: according to the STS, the corporate income tax burden for Q1–Q3 2025 increased to 1.0% compared to 0.98% in 2024. The VAT burden in December 2025 reached 3.02% (versus 2.94% in November), which correlates with the growth in the share of officially recorded transactions.At the same time, the number of officially employed workers in the sector remains almost unchanged at about 32 thousand people, but the average wage increased by roughly UAH 4.1 thousand after the dialogue with business intensified. This may indicate a gradual reallocation of financial flows from “envelope wages” towards legal remuneration, although a complete phase‑out of shadow payments has obviously not yet taken place. Structural challenges: what remains in the shadowDespite the positive dynamics, the STS and sectoral authorities emphasize the systemic nature of the problems that still fuel the shadow segment of the market. These include: “grey” imports of appliances with understated customs value, sales without fiscalization and inventory accounting, the use of fake documents to confirm the origin of products, splitting chains into sole proprietors, and employing staff without proper registration or with only minimum official wages.A separate challenge is posed by online platforms, where control over fiscalization and compliance with RRO/PRRO rules is traditionally more difficult than in brick‑and‑mortar stores. That is why the tax service declares its intention to expand analytical work, in particular through the analysis of RRO/PRRO data, time‑studies, and comparison of customs, tax and banking data, as well as to continue targeted inspections of “high‑risk” sellers. Takeaways for business and future trendsRevenue growth of more than 50% and an almost 25% increase in the number of fiscal receipts over four months confirm that even a relatively soft but consistent detinization policy quickly boosts budget revenues and levels the playing field for compliant retailers by reducing the impact of “grey” schemes and price dumping. In the medium term, this implies further growth in the share of cashless payments, tighter control over inventory balances, development of joint government–business initiatives, and a higher cost of shadow models due to fines and reputational and operational risks. If you have questions or issues related to detinization of operations, tax audits, the use of RRO/PRRO, staff registration or minimization of tax risks in the trade of appliances and electronics, you are welcome to seek professional advice – a timely audit of your business model usually costs much less than the consequences of tax reassessments and fines. Author: Ihor Yasko, Managing Partner at JSC “WINNER Law Firm”, PhD in Law.​ https://www.youtube.com/watch?v=tRwbugMQXtk&t=4s

Потрібна допомога адвоката? Залишай заявку From the beginning of 2026, businesses have once again faced changes in transport documentation: an order of the Ministry of Infrastructure has updated the classic form of the goods road consignment note (TTN), without which no road transportation of goods can be carried out. Although this is not yet a fully electronic format, the new version of the TTN already lays the foundation for further digitalization of logistics document flow. What has changed in the TTN form The updated form takes into account the technical aspects of transportation and the requirements for traceability of goods flows. The mandatory details have been clarified: the data of the consignor, consignee and carrier have been elaborated, and separate fields for identification codes (EDRPOU/Tax ID) have been introduced to simplify automated matching and avoid data duplication. The structure of the sections has been changed: information on the goods, data on the vehicle, details of the carrier and the signatures of the parties are separated into distinct blocks, which speeds up completion and reduces the risk of errors, especially during electronic data entry. The requirements for e‑TTN have been taken into account: fields for the unique number of the electronic document, QR code and electronic signature have been added, which orients the form towards a further transition to e‑TTN. The presentation of weight parameters has been clarified: precise data on net weight, gross weight and fuel remaining are provided, allowing better control over compliance with weight limits and helping avoid fines. The possibilities for international transportation have been expanded: fields have been added for indicating the country code of dispatch and destination, which brings the form closer to international standards, in particular the CMR consignment note. Practical implications for businessFor companies that supply goods, changes to the TTN form mean the need for urgent updates of document templates. However, the key point is not merely a redesign of the paper form, but preparation for an electronic future. It is worth considering several practical aspects: Software updates. Companies using ERP or accounting systems (1C, BAS, SAP, etc.) need to verify the correctness of the new TTN fields and formats so that their documents comply with the regulatory form. Staff training. Drivers, freight forwarders and accountants must understand which particulars have become mandatory and which details receive special attention during inspections. Data consistency checks. The new requirements emphasize the importance of accurate information about the parties to the carriage contract. Any discrepancies in names or codes may complicate expense accounting or VAT recovery. Regulatory rationale for the changesThe reform of the TTN form is part of the government’s strategy for digitalizing transport operations. In 2024–2025, the Ministry of Infrastructure, the Ministry of Digital Transformation and the State Transport Safety Service implemented a pilot e‑TTN project. The updated TTN form has become a universal basis that can be used in both paper and electronic formats without loss of legal force. In fact, the state is creating legal and technical conditions for a gradual phase‑out of paper TTNs. The transition to e‑TTN will make it possible to: automatically confirm the fact of transportation and acceptance of goods; reduce administrative costs for businesses; eliminate fictitious transport operations; provide regulatory bodies with instant access to transport data. For now, the legislation maintains a hybrid regime: e‑TTN is allowed only within the framework of an experiment, while the updated paper form must already be used. It is expected that in the coming years it will evolve into a fully electronic document. Challenges for carriers and logistics companiesMost of the fixed changes will affect carriers directly. The updated TTN requirements impact: accounting for fuel and repair costs, since the form now requires more detailed data on the route, cargo weight and mileage; control over exceeding weight limits — the document contains more parameters that will be used for automated checks at stationary and mobile weighing stations; responsibility for data accuracy — errors or missing mandatory particulars may be treated as violations of licensing conditions. For logistics operators, it is important to ensure in advance that the new TTN fields are synchronized with journey sheets, GPS systems and accounting records. In the future, this will be the basis for a seamless transition to digital data exchange. Why the transition is not yet fully electronicThe main reason why the state has not yet moved TTN into a mandatory electronic format is the incomplete readiness of infrastructure. Not all carriers have access to stable internet, electronic signatures or integrated exchange platforms. There also remain open questions: whether supervisory authorities in remote areas will have the technical capacity to verify e‑TTNs in real time; how to handle situations involving combined transport (partly electronic, partly paper‑based); what mechanisms will be used for storing and archiving electronic documents in case of disputes or tax audits. Thus, the paper form remains in force but already has all the characteristics that will allow a seamless transition to e‑TTN once its full legal regime is approved. What businesses should do nowCompanies should not wait for the final introduction of e‑TTN but act proactively. It is useful to: update TTN templates in their documentation in line with the new form; conduct an internal audit of logistics processes and ensure that transportation data are stored systematically; verify the availability of electronic signatures for responsible staff; establish data exchange between the logistics department, accounting and suppliers. Early adaptation will help avoid problems during the transition to full‑scale electronic document circulation when it becomes mandatory. For most medium and large companies, these steps are already not just a formality, but part of their digital strategic readiness. If you have questions or issues related to applying the new TTN form, updating internal document templates or preparing for the introduction of e‑TTN, our experts are ready to help you assess risks, adapt procedures and ensure compliance with legal requirements. Author: Ihor Yasko, Managing Partner of the law firm “WINNER”, PhD in Law. https://www.youtube.com/watch?v=tRwbugMQXtk&t=4s