Military tax and tax innovations for sole proprietors in 2025: the Council of Entrepreneurs under the Cabinet of Ministers of Ukraine gave an explanation
At the beginning of 2025, new changes to the Tax Code came into force in Ukraine, which affected the amount of military duty and other tax obligations of individual entrepreneurs (PEOs). These innovations became part of the government’s policy aimed at strengthening the country’s economic support under martial law. Clarification of the new rules provided Andrii Zablovskyi, head of the Secretariat of the Council of Entrepreneurs under the Cabinet of Ministers of Ukraine.
The new size of the military levy
From January 1, 2025, the amount of the military levy for FOPs increased from 1.5% to 5%. The following rules are established for different categories of entrepreneurs:
- For the first, second and fourth groups of FOPs: the military levy is 10% of the minimum wage, i.e. not less than UAH 800 per month. The payment obligation arises monthly, and the first payment for January must be made by January 20.
- For the third group of FOPs: the military tax is 1% of the income for the reporting period. The first payment for this group for the first quarter must be paid by May 20.
- Businesses closing the fiscal year 2024 will still pay the military tax at the rate of 1.5%, but the new rules will come into effect from the beginning of 2025.
Return of mandatory payment of EUV
One of the key changes was the return of the mandatory Single Social Security Contribution (SSC), which was temporarily optional after the full-scale invasion began. The minimum wage rate for self-employed persons is now 22% of the minimum wage, which is 1,760 hryvnias per month. Non-profit organizations can pay the EUV both monthly and quarterly.
For those whose income exceeds 160,000 hryvnias per month, the maximum EUV rate is provided in the amount of 15 minimum wages.
Growing fiscal pressure
The increase in the tax burden has already affected the number of individual entrepreneurs who are ceasing their activities. According to OpenDataBot, only in the first two weeks after the entry into force of the new rules, 22,500 FOPs closed their activities, which is about 2,300 closures per day. For comparison, in normal times this indicator did not exceed 700 closures per day.
Andrii Zablovsky noted that such innovations demotivate many entrepreneurs to continue their activities. At the same time, he emphasized that the mechanisms for paying new taxes remain relatively simple from the point of view of administration, and information on their payment is available on official services.
Return of DPS checks
In 2025, the number of scheduled and unscheduled inspections of business entities conducted by the State Tax Service (SST) will also increase. According to the published plan, inspections of almost 5,000 counterparties are planned this year. This is a return to pre-war practice, which began at the end of 2022.
Despite the growing tax burden, the government and tax authorities emphasize that these measures are aimed at strengthening the state budget and supporting the Armed Forces of Ukraine. However, entrepreneurs are already expressing concern that the new conditions may cause a significant reduction in the number of FOPs and an increase in the shadowing of the economy.
