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Non-residents’ salary dues and taxes in Ukraine

The legislation of Ukraine provides that tax is an obligatory, unconditional payment to the state budget, collected from natural and legal persons (including non-residents). The main tax which is collected from a foreign person’s salary received within the territory of Ukraine is the natural persons’ income tax (hereinafter referred to as ‘NPIT’).

The rate of this tax amounts to 15 per cent (17 per cent if a remuneration amount exceeds ten minimal salaries, approximately USD 1,200.00; it is applied to an exceeding amount) from a total salary, minus the amount of the unified social payment and social benefit tax.

A due is an obligatory payment to the state or local budget, collected from due payers as a result of relevant in law actions, provided to the benefit of the latter by the state and local authorities, other authorized institutions and persons. The due which is collected from a foreign person’s salary is the unified social payment (hereinafter referred to as ‘USP’). The USP, a rate of 3.6 per cent, contributes to the pension fund and social insurance funds in the event of unemployment and temporary disability.

The social benefit tax is applied to a total monthly salary of a natural person – non-resident, provided that its amount does not exceed the level of the monthly living wage, applicable to an able-bodied person. As of 2012 the tax social benefit is applied to the income which does not exceed UAH 1,500.00 (approximately USD 190.00).

As an example, calculated taxes and dues from a salary of a foreign person are shown below:

  • a foreign person received a salary in amount of UAH 8,000.00 (approximately USD 1,000.00);
  • USP = UAH 8,000.00 * 3.6 % = UAH 288.00;
  • NPIT = (UAH 8,000.00 – UAH 288.00) * 15 % = UAH 1,157.00.

Therefore, the overall amount of taxes and dues, collected from a foreign person’s total salary of UAH 8,000.00, amounts to UAH 1,445.00, the remaining UAH 6,555.00 (more or less USD 819.00) shall be paid to an employee (the social benefit tax is not applied to the latter amount).

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