International Monetary Fund (IMF) positively assessed submission by the Cabinet of Ministers to the parliament of a draft law on tax reporting requirements for digital platform operators.
"The bill on reporting requirements for digital platform operators must be passed quickly to bring a significant and growing sector of the economy out of the shadows," — stated in the text of the Memorandum.
This will allow the State Tax Service (STS) to receive data from digital platform operators and international bodies on the income of individuals who receive it without registering as a private entrepreneur or using the simplified taxation system (STS).
"These changes will become an effective tool for controlling the timeliness, accuracy and completeness of the declaration of such income, and will also contribute to a significant expansion of the tax base by including individuals whose income is currently not taxed. This measure will facilitate revenue mobilization and harmonization of Ukrainian tax legislation with EU legislation and OECD standards, and will also be the first step towards reforming the SSO system through the introduction of new digital SST control tools," — stated in the IMF document.
"The relevant legislative amendments were submitted to the parliament on April 30, 2025. We aim for their swift adoption by the end of 2025. To further stimulate tax discipline, the bill provides for a 5 percent turnover tax on income received through digital platforms. At the same time, the law will not introduce new VAT exemptions." – the government points out for its part.
Let us recall that we are talking about bill 13232, according to which sellers of things on online platforms will in certain cases have to pay up to 23% taxes on the funds received.
The State Tax Service will also be able to receive, upon request, data on the movement and balance of funds in the bank accounts of accountable sellers of online platforms. That is, the tax service will be exposed to bank secrecy regarding the accounts of citizens who find clients through these platforms to provide services, sell goods, offer housing for rent, etc.
In turn, online platforms will be required to transmit information to the tax office, which will include the residential address of accountable sellers and the address of the location of the housing if such sellers offer it for rent.
Reportable activity, as defined by the Cabinet of Ministers, is any of the following activities carried out by a seller through the platform for remuneration:
- leasing of real estate, including residential and non-residential real estate, as well as any other real estate and parking spaces;
- personal services;
- sale of goods;
- rental of vehicles.
The income of an individual - a responsible seller - from carrying out reporting activities through at least one platform is taxed at a rate of 5%, provided that the requirements of paragraph 178-1.2 of the Tax Code are met (if such an individual has opened a special account to carry out the relevant activity for taxation purposes, etc.).
However, the income of such an individual - a accountable seller - will be taxed at a rate of 18% if the platform operator does not fulfill the obligations established by paragraph 347.2 of Article 347 of the Tax Code (for example, he did not submit an application for registration with the tax office as an accountable platform operator).
As noted by Olga Vasilevska-Smaglyuk, a member of the parliament's tax committee, this bill introduces new tax rules for OLX and other online platforms.
"Ukraine is preparing to implement EU standards in the field of taxation of income received through digital platforms - such as OLX, Prom, Kabanchik, Booking, BlaBlaCar and others," she noted.
For ordinary users, the bill provides, according to her, the following.
- If you are not an individual entrepreneur and receive income through OLX, Prom, BlaBlaCar or Airbnb, you will only be able to pay 5% tax.
- But you need to open a separate special account and notify the platform about it
- If a person has no more than 3 sales per year up to 2000 euros, the platform itself will keep 5% and that's it, nothing more is needed
- If earnings exceed UAH 6,7 million or a person uses hired labor, they must declare and pay 18%.
"This will allow you to avoid "black cash", make your income official - and at the same time avoid the complicated registration as an individual entrepreneur," she added.
In turn, the first deputy chairman of the parliamentary tax committee, Yaroslav Zheleznyak, noted that the bill contains a risk that people will be taxed at a rate of 23%. In addition, it directly stipulates the opening of banking secrecy.
Nina Yuzhanina, a member of the Verkhovna Rada Committee on Tax Policy, noted that the Cabinet of Ministers' draft law "is paradoxical."
Thus, currently, income from the sale of a house or apartment worth 10 million hryvnias is not taxed (one sale per year, provided that the property has been owned for more than 3 years). Income from the sale of a car worth 5 million hryvnias is also not taxed (one sale per year).
However, if the Cabinet of Ministers' bill is approved, then, according to her, the income from the sale of a children's scooter worth 200 hryvnias on a free classifieds website will be taxed at a rate of 10% or 23% (a higher rate if the sale of the scooter is the fourth sale in a year, and before that the person sells three more children's toys). "And this is despite the fact that all these things were purchased from income that is already taxed by personal income tax and military service," she noted.
Therefore, income of individuals from the sale of goods or provision of services through digital platforms will be subject to personal income tax at rates of 5% or 18% and military duty (5%).
According to Yuzhanina, a resident taxpayer who meets the following requirements will have the right to tax income at a personal income tax rate of 5% (plus 5% military levy):
- has at least one current account opened specifically for the purposes of carrying out reporting activities and has given the bank consent to the bank's disclosure of information containing banking secrecy;
- makes payments using such an account;
- is not a self-employed person;
- does not use hired labor;
- the amount of income received by the taxpayer during the calendar year does not exceed 834 times the minimum wage (about 6,7 million hryvnias as of January 1.01.2025, XNUMX)
- does not sell excisable goods.
"At the same time, if during the calendar year no more than 3 sales of goods are made through the platform for a total amount not exceeding the equivalent of 2000 euros, an individual has the right not to open a SPECIAL current account in the bank for reporting activities, but to use existing current accounts in the bank opened FOR OWN NEEDS. In this case, the tax rate will be 5% personal income tax and 5% military levy. So, from the first 3 sales of used items on OLX, 10% will be withheld, and from the fourth, if the individual does not open a special account and does not agree to disclose bank secrecy, 23% (18% personal income tax and 5% military levy)", — explained Nina Yuzhanina.
What other novelties does the bill provide for?
Vasilevska-Smaglyuk added that the bill also provides for:
- international exchange of information on revenues generated through platforms
- 5% preferential tax for individuals who are not sole proprietors but sell or rent through platforms
- the duties of a tax agent are assigned to the platform: it must withhold and pay tax for the individual
- limits: up to 6,7 million UAH per year without registering as an individual entrepreneur, but with a special account and without using employees
- micro-sellers with less than 3 transactions for an amount of up to 2000 euros - can work without a special account
Registration of platforms with the State Tax Service by April 1, 2026, first reporting in 2027.
She also drew the attention of entrepreneurs to the fact that from 2026, digital platforms that provide sellers with access to online marketplaces are required to:
- Register with the State Tax Service
- Identify sellers
- Report on their income annually (the report will include data on citizens who sell goods or provide services through online platforms – ed. note)
- Withhold 5% personal income tax under certain conditions.
This applies to both Ukrainian and foreign platforms that work with Ukrainian users.
The transition period is until January 1, 2026.
What does the Cabinet of Ministers focus on?
The Cabinet of Ministers, in turn, explained the following regarding its draft law 13232 "On Amendments to the Tax Code of Ukraine and Certain Other Legislative Acts of Ukraine Regarding the Implementation of International Automatic Exchange of Information on Income Received through Digital Platforms."
The draft law provides for amendments to the Tax Code, which propose:
- to supplement the Tax Code with a new article “International Automatic Exchange of Information on Income Received through Digital Platforms”, which defines the basic requirements for the establishment of accountable sellers by accountable platform operators and the submission of reports on income received by accountable sellers through platforms for the purposes of the Multilateral Agreement of Competent Authorities on the Automatic Exchange of Information on Income Received through Digital Platforms;
- define concepts related to reporting on income received through digital platforms;
- establish an obligation for accountable platform operators to:
- apply due diligence measures to identify accountable sellers among platform users;
- submit to the State Tax Service reports on the income of accountable sellers that they receive from carrying out reporting activities;
- submit an application for their registration with the State Tax Service within 60 calendar days after the operator establishes the status of a accountable platform operator;
- determine the types of activities that are reportable activities, namely:
- leasing of real estate (including residential and commercial real estate, as well as any other real estate and parking spaces);
- personal services;
- sale of goods;
- rental of vehicles;
- establish a clear list of information that accountable platform operators will submit to the State Tax Service in the report on the income of accountable sellers;
- introduce liability for platform operators for violations of requirements for identifying accountable sellers and submitting reports for the automatic exchange of information on revenues generated through digital platforms;
- to grant the right to individuals - accountable sellers of digital platforms - to use a preferential taxation regime for income received through digital platforms. The concept of taxation of income of such individuals provides for the establishment of a tax rate of 5% for such income and the imposition of tax agent duties on accountable platform operators.
It is provided that the right to tax income from reporting activities at a rate of 5% is granted to a resident taxpayer who has reached the age of 18 and simultaneously meets all of the following requirements:
- the taxpayer has at least one current account opened specifically for the purposes of carrying out reporting activities, and notifies each accountable platform operator with whom an agreement has been concluded to provide access to the platform of the number (details) of the current account through which payments are made during the performance of reporting activities;
- makes payments during reporting activities exclusively in monetary form – cash or non-cash – using a current account opened specifically for the purposes of reporting activities;
- a decision has not been made regarding the application of special economic and other restrictive measures (sanctions) in accordance with the procedure established by the Law "On Sanctions";
- is not a self-employed person according to the Tax Code;
- does not use hired labor;
- the amount of income received by an individual - a responsible seller during the calendar year from carrying out reporting activities cannot exceed 834 times the minimum wage established by law as of January 1 of the tax (reporting) year;
- does not sell excisable goods.
To provide that if an individual - a responsible seller - during the reporting period (calendar year) made no more than three sales of goods through the platform for a total amount not exceeding the equivalent of 2 euros per calendar year at the official exchange rate of the hryvnia against the euro established by the National Bank of Ukraine as of January 000 of the reporting tax year, such an individual has the right not to open a current account in a bank to carry out reporting activities, but to use existing current accounts in a bank opened for his own needs.
To provide that the tax agent of an individual - a responsible seller with respect to income from reporting activities is:
- a reporting platform operator that accrues (calculates), pays or provides income from carrying out reportable activities for the benefit of any reporting merchant;
- a qualified platform operator that accrues (calculates), pays or provides income from reporting activities for the benefit of a reporting seller who is a resident of Ukraine. A qualified platform operator is a tax agent solely with respect to income from reporting activities of individuals who are residents of Ukraine.
- It is also proposed to amend the Law "On Banks and Banking Activities", which, in particular, would provide for the provision by banks, upon request of the State Tax Service, of information on transactions on current accounts of accountable sellers, namely information on a specified date or for a specified period of time on transactions of crediting funds to current accounts. The proposed amendments apply exclusively to those individuals who will use the preferential taxation regime for income from reporting activities, and are aimed at counteracting abuse of the preferential taxation regime by individuals.
The draft law prohibits the State Tax Service of Ukraine from providing information on accountable sellers, in particular, received from competent authorities of foreign states, to other persons, including law enforcement or other state bodies, local self-government bodies, legal entities and individuals, except in cases of providing such information in accordance with the requirements of a valid international treaty containing provisions on the exchange of information for tax purposes. The State Tax Service collects information from accountable platform operators, stores, protects such information and transfers the information to the competent authority of a foreign jurisdiction.
The draft law aims to ensure the introduction in Ukraine of international automatic exchange of information on income received through digital platforms and the harmonization of national tax legislation with the law of the European Union and the Organization for Economic Cooperation and Development, which will contribute to the fulfillment of Ukraine's international obligations as a candidate country for membership in the EU and the OECD. In particular, the draft law provides for the implementation of the provisions of the OECD Model Rules on reporting by digital platform operators and the provisions of Council Directive (EU) 2021/514 of 22 March 2021 amending Directive 2011/16/EU on administrative cooperation in the field of taxation.
