Selling your own agricultural products: tax limits that every landowner should know about

The issue of taxation of income from the sale of one’s own agricultural products remains unclear to many citizens, as the tradition of selling surpluses from the garden or apiary is perceived as a normal part of everyday life, and not as an activity that may have tax consequences. At the same time, the norms of the Tax Code of Ukraine clearly define the limits under which such income is not included in the taxable income, and also establish specific conditions, after exceeding which the seller is obliged to file a declaration and pay tax.

The lawyers of the law firm “Repeshko and Partners”, to whom our editorial office contacted, commented on how the provisions of the Tax Code of Ukraine regarding the sale of own crop and livestock products are applied, in which cases citizens can work without registering as an individual entrepreneur, what income is exempt from taxation, and what risks arise in case of exceeding the limits established by law or the absence of supporting documents.

Oddly enough, when growing and selling their own vegetables, few people think about the fact that under current legislation such actions are subject to taxation. Ordinary citizens have somehow become accustomed to the fact that honey sold from an apiary or three baskets of potatoes from a garden are in no way of interest to the state. On the one hand, this is true, but there are significant nuances.

According to clause 165.1.24 of clause 165.1 of Art. 165 of the Tax Code of Ukraine, the total monthly (annual) taxable income of a taxpayer does not include income received from the sale of his own agricultural products, grown, fattened, caught, collected, manufactured, produced, processed and/or processed directly by an individual on land plots, for conducting:

• horticulture and/or for the construction and maintenance of a residential building, outbuildings and structures (homestead plots) and/or for individual summer cottage construction;
• personal farm and/or land shares (shares) allocated in kind (on the ground).

Income received from the sale of his own agricultural products (except for livestock products) is not taxable income if the total amount for the year does not exceed 12 times the minimum wage established by law as of January 1 of the reporting (tax) year. From January 1, 2026, the minimum wage in Ukraine is 8647 UAH, so 12 x 8647 = 103,764 UAH.

If the income received exceeds the specified amount, then such a taxpayer is obliged to reflect the amount of the excess as part of the total monthly (annual) taxable income for the relevant reporting year and submit an annual tax declaration on property status and income, in accordance with the norms of the Tax Code of Ukraine, and independently pay tax on the amount of the excess.

In addition, if the size of land plots exceeds the norms established by the Land Code of Ukraine – 2 hectares, then such income is included by the taxpayer in the total annual taxable income, is subject to reflection in the declaration on property status and income based on the results of the reporting tax year and is taxed at a rate of 18% and a military levy of 5%.

However, it should be noted that currently there is no effective mechanism for controlling who has grown and sold how much of the citizens. Questions may arise only if the products are sold in one large batch officially from one person or regularly in official markets where traders are registered. However, smart and careful peasants usually divide large batches into small ones, the sale of which is already carried out on behalf of the husband, wife, granddaughter and other members of the peasant household.

In this case, it should be noted that when selling either a large batch of agricultural products (except livestock products), or at the request of the buyer, the owner of the products must provide the tax agent (buyer) with a copy of the Certificate of Availability of Land Plots for Gardening and/or for Construction and Maintenance of a Residential Building, Outbuildings and Structures (Homestead Plots) and/or for Individual Summer Cottage Construction, or for Conducting a Personal Farm and/or Land Shares (Shares) Allocated in Kind (On the Ground) (Certificate 3-DF).

The specified Certificate is issued by the village, settlement, city council or council of an ATC, at the place of tax address (place of residence) of the taxpayer within 5 working days from the date of receipt by the relevant council of a written application for the issuance of such a certificate.

The certificate is issued personally to the owner of agricultural products, if the agricultural products are grown, fattened, caught, collected, manufactured, produced, processed and/or processed directly by an individual on land plots provided to him in the sizes established by the Land Code of Ukraine for conducting: gardening and/or for construction and maintenance of a residential building, outbuildings and structures (homestead plots) and/or for individual summer cottage construction; personal peasant economy and/or land shares (shares) allocated in kind (on the ground), the total size of which does not exceed 2 hectares.

This certificate is issued for a period of five years, its original must be kept by the owner of agricultural products during the limitation period from the date of its expiration. Information on the issuance of the certificate is transmitted by the village, settlement, city council to the supervisory authority at the location of the land plot within 10 days from the date of issuance of the certificate to the owner of agricultural products.

As for the sale of own livestock products, here is a slightly different story. The country operates the Ukrainian Classification of Goods for Foreign Economic Activity (UKCFE) – an abbreviation of the Ukrainian Classification of Goods for Foreign Economic Activity. That is, income received from the sale of goods of groups 1 – 5, 15, 16 and 41 of the UKCFE is not taxable income if their total amount for the year does not exceed 50 times the minimum wage established by law as of January 1 of the reporting (tax) year. From January 1, 2026, the minimum wage in Ukraine is UAH 8,647, so 50 x 8,647 = UAH 432,350. In this case, individuals sell the specified products without obtaining a certificate of the availability of land plots.

If the amount of income received exceeds the established amount, clause 165.1.24 clause 165.1 of Art. 165 of the Tax Code of Ukraine, a citizen is obliged to submit to the regulatory body a certificate of independent cultivation, breeding, fattening of livestock products, issued in any form by the village, settlement, city council or council of an ATC, at the place of tax address (place of residence) of the owner of livestock products. If the certificate confirms the cultivation of sold livestock products directly by the taxpayer, then income that exceeds 50 times the minimum wage established by law as of January 1 of the reporting (tax) year is subject to taxation.

If the taxpayer does not confirm independent cultivation, breeding, fattening of livestock products, the income from the sale of which he received, then such income is subject to taxation on general grounds.

In Ukraine, the Ukrainian Classification of Goods for Foreign Economic Activity (UKT FEA) is in force. This is an official system of dividing all goods into groups and subgroups, which is used for customs clearance, taxation and determining the legal status of products. Each product is assigned a special code, and the first two digits of this code indicate its group – that is, the general category of products. The Tax Code of Ukraine refers to such groups of the UKT FEA, determining which types of livestock products can be sold by individuals without taxation (subject to compliance with established annual income limits).

These groups include:

• group 01 — live animals;
• group 02 — meat and edible offal;
• group 03 — fish, crustaceans, molluscs and other aquatic invertebrates;
• group 04 — milk and dairy products, poultry eggs, natural honey, as well as other edible products of animal origin, not included in other groups;
• group 05 — other products of animal origin;
• group 15 — fats and oils of animal or vegetable origin, products of their processing, prepared edible fats and waxes;
• group 16 — prepared food products from meat, fish or other aquatic invertebrates;
• group 41 — raw hides and skins (except fur).

In other words, if a citizen sells, for example, home-grown livestock, meat, fish from his own pond, milk, cheese, eggs or honey, and the annual income does not exceed the limit established by law, such activity can be carried out without registering as an individual entrepreneur and without the obligation to pay tax on these amounts.

If the products fall into the above groups, then it is quite possible and legal to carry out agricultural activities without registering as an individual entrepreneur. If the income does not exceed a certain amount, then there is no taxation.

The main thing to remember is that if the amount of income received exceeds the specified amount, the taxpayer is obliged to:

• reflect the amount of such excess as part of the total monthly (annual) taxable income for the relevant reporting year
• submit an annual declaration of property status and income,
• independently pay personal income tax and military levy on the amount of such excess.

We also remind you that from January 1, 2026, a campaign for annual declaration by citizens of income received in 2025 began, which will last until May 1.

If income exceeds the specified limits that we indicated above, the income received by a citizen is taxed at a rate of 18% – personal income tax and military levy at a rate of 5%.

It is worth knowing that untimely submission or failure to submit a tax return by a taxpayer – an individual, the obligation to submit which to the regulatory authorities is stipulated by the Tax Code of Ukraine, entails the imposition of a fine of 340 hryvnias.

If a citizen has sold products not provided for in paragraphs 1 – 5, 15, 16 and 41 of the Tax Code of Ukraine for Foreign Economic Activity, then in this case, for sale without registration as an individual entrepreneur (if systematic activity is proven), the fine is from 17,000 to 34,000 hryvnias with confiscation of products and income.

We are so carefully considering this type of sale, because recently the legislator has been taking the path of increasing the tax burden and introducing taxes wherever possible. This does not exclude mass raids on food markets in order to attract sellers of their own garden under Article 164 of the Code of Ukraine on Administrative Offenses. So we hope that this article will help in a reasoned dispute with regulatory authorities regarding violations of the norms of current legislation. Therefore, we strongly recommend that, in order to avoid unnecessary disputes, you take care of obtaining a 3-DF certificate in advance, because its presentation will remove almost all questions at once.

And once again – a citizen does not need to register as an individual entrepreneur and pay taxes for the sale of his own products if:

• income from the sale of livestock products does not exceed 50 times the minimum wage;
• the products fall under items 1 – 5, 15, 16 and 41 of the Ukrainian Code of Foreign Economic Activity
• income from the sale of agricultural products does not exceed 12 times the minimum wage;
• the size of the land plot does not exceed 2 hectares.

Therefore, we advise you to find out three key points before starting regular sales of your own products: whether the area of ​​your land plot does not exceed the established norms, whether you are included in the marginal annual income and whether your products belong to the relevant groups of the Ukrainian Code of Foreign Economic Activity. If there is a possibility of official sale or large batches, get a 3-DF certificate in advance. This will help avoid fines, tax disputes, and the risk of being accused of operating without registration.