Taxation in Ukraine
Taxes, levies and general tax principles in Ukraine are determined by the Law of Ukraine “On the Taxation System of Ukraine.” The Law classifies all taxes or levies in Ukraine as either national or local.

Some of the mandatory taxes in Ukraine include:

•    Value added tax
•    Personal income tax
•    Corporate income tax
•    Excise duty
•    Customs duty
•    State duty
•    Payments for licenses and patents
•    Vehicle owner’s tax
•    Land tax
•    Pension fund and social security fund deductions
Such national taxes as value added tax, corporate income tax, personal income tax, and excise and custom duties make up the largest portion of the state budget revenues. Locally, authorities in Ukraine may also implement a number of local taxes, such as community development tax, recreation tax, advertisement tax, parking tax, and others.
According to the Constitution of Ukraine, any taxes or levies, as well as sanctions for tax violations, may only be established by laws passed by the Verkhovna Rada of Ukraine, which cannot delegate its constitutional powers in this field to the government or any other authority.
Ukraine has concluded double taxation treaties with over 50 countries, many of which are following the OECD Model Income Tax Convention:

•    Armenia
•    Austria
•    Azerbaijan
•    Belarus
•    Belgium
•    Bulgaria
•    Canada
•    China
•    Croatia
•    Cyprus
•    Czech Republic
•    Denmark
•    Egypt
•    Estonia
•    Finland
•    France
•    Georgia
•    Germany
•    Hungary
•    India
•    Indonesia
•    Iran
•    Italy
•    Japan
•    Kazakhstan
•    Korea
•    Kyrgyzstan
•    Latvia
•    Lithuania
•    Macedonia
•    Malaysia
•    Moldova
•    Mongolia
•    Netherlands
•    Norway
•    Poland
•    Portugal
•    Romania
•    Russia
•    Slovak Republic
•    Spain
•    Sweden
•    Switzerland
•    Turkey
•    Turkmenistan
•    United Kingdom
•    United States
•    Uzbekistan
•    Vietnam
•    Yugoslavia
Ukraine has also established restrictions on the deductibility of expenses incurred by resident taxpayers as consideration for goods or services received from or provided by nonresident entities that are located in offshore zones. The abovementioned restriction applies to expenses paid for the benefit of nonresidents with “offshore status” or settlements made through such nonresidents (their bank accounts). Thus, only 85 percent of such expenses incurred or paid are deductible or amortizable.
The official list of offshore jurisdictions is published by the Cabinet of Ministers of Ukraine and is updated periodically. Currently the list of offshore jurisdictions includes the following territories:

•    Alderney Island
•    Andorra
•    Anguilla
•    Antigua and Barbuda
•    Aruba
•    Bahamas
•    Bahrain
•    Barbados
•    Belize
•    Bermuda
•    British Virgin Islands
•    Cayman Islands
•    Cook Islands
•    Dominica
•    Dutch Antilles
•    Gibraltar
•    Grenada
•    Guernsey Island
•    Isle of Man (UK)
•    Jersey Island
•    Liberia
•    Marshall Islands
•    Monaco
•    Montserrat
•    Nauru
•    Niue
•    Panama
•    Puerto Rico
•    Republic of Maldives
•    Samoa
•    Seychelles
•    St. Kitts-Nevis
•    St. Lucia
•    St. Vincent and Grenadines
•    Turks and Caicos Islands
•    Vanuatu
•    Virgin Islands (USA)

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