To the attention of taxpayers – individuals: declaration campaign 2023 has started

Press service of the State Tax Service of Ukraine, published 12 January 2023 at 10:49 Chapter: Information messages

Citizens’ income declaration campaign received during 2022 is ongoing from January 1, 2023.

To submit declaration of assets and income (hereinafter – tax declaration) for the past year and pay relevant taxes and levies is a constitutional obligation of citizens and their personal support of the state, its financial security and defense capability.

To cases according to which taxpayers – individuals are obliged to independently calculate amounts of the personal income tax (hereinafter – tax) and military levy, which are subject to payment to the budget based on the results of reporting tax year by submitting tax declaration to the tax authority, established by Section IV of the Tax Code of Ukraine (hereinafter – Code), belong:

- receipt of certain types of income from tax agents that are not subject to taxation upon payment, but are not exempted from taxation (Sub-paragraph 168.1.3 Paragraph 168.1 Article 168 of the Code) (debt amounts for which statute of limitations has expired; non-targeted charitable assistance in excess of the established norm; additional wealth, etc.);

- receipt of income from a person who is not tax agent (from other individuals (residents or non-residents)) (Sub-paragraph 168.2.1 Paragraph 168.2 Article 168 of the Code) (inheritance, gifts, from renting property to another individual, income from the sale (exchange) of movable and immovable property, in cases provided for by the Code, etc.);

- receipt of foreign income (Sub-paragraph 170.11.1 Paragraph 170.11 Article 170 of the Code);

- receipt of income from entrepreneurial activity by individuals – entrepreneurs (except for individuals who chose the simplified taxation system) (Article 177 of the Code);

- receipt of income from conduction of independent professional activity by individuals, who conduct independent professional activity (Article 178 of the Code);

- acquisition of status of resident of Ukraine by a foreigner (Sub-paragraph 170.10.4 Paragraph 170.10 Article 170 of the Code). Such individuals must show in tax declaration income with source of their origin in Ukraine and foreign income.

Along with that, the Code provides for cases according to which the taxpayer is exempted from submission of tax declaration upon the receipt of income:

- from tax agents, which according to Section IV of the Code are not included in the total monthly (annual) taxable income;

- exclusively from tax agents, regardless of the type and amount of accrued (paid, provided) income, except for cases expressly provided for in Section IV of the Code;

- from the sale (exchange) of property, donations, income from which is not taxed according to this Section, is taxed at zero rate and / or from which, upon notarization of contracts, tax was paid according to Section IV of the Code;

in the form of inheritance objects, which according to Section IV of the Code, are taxed at zero tax rate and / or from which tax has been paid according to Paragraph 174.3 Article 174 of the Code.  

Please note that for individuals – taxpayers – residents of Ukraine, income received in the form of sums of funds or free goods (services) provided at the expense of budgetary funds of foreign countries and their state funds to such taxpayer and his / her family members of the first degree of kinship as persons who suffered as a result of the armed aggression of russian federation against Ukraine and used right for temporary protection according to legislation of such foreign state (hereinafter – assistance), pursuant Paragraph 27 Sub-section 1 Section XX "Transitional provisions" of the Code, are not included in the total monthly (annual) taxable income of taxpayer for the tax (reporting) years 2022 and 2023. At the same time, the specified benefit applies to all forms of providing specified assistance, including in case of receiving it as an additional benefit, as well as from foreign companies and organizations that, according to legislation of relevant foreign jurisdiction, carry out charitable activities.

Therefore, individuals – taxpayers – residents of Ukraine who have used right for temporary protection in other countries of the world, assistance received from foreign states and their state funds, as well as from foreign companies, organizations that, according to legislation of relevant foreign jurisdiction, carry out charitable activities are declared as foreign income, while the personal income tax and the military levy on such amounts are not determined and not paid. That is, they indicate only receipt of such funds as income without tax and levy.

Herewith, property and income tax declaration can be submitted electronically through the Electronic Cabinet (cabinet.tax.gov.ua) in the "E-Cabinet for citizens" - "Property and income tax declaration" section.

Individuals identified by the personal key issued by the qualified provider of electronic trust services will be able to use the specified service.

Please note that new tax declaration form has been in use since January 1, 2023, which was approved by Order of the Ministry of Finance of Ukraine № 143 as of 17.05.2022 "On amendments to the Property and income tax declaration form and Instructions for completing property and income tax declaration", registered in the Ministry of Justice of Ukraine on 03.06.2022 under № 593/37929.

Sub-paragraph 49.18.4 Paragraph 49.18 Article 49 of the Code stipulates that tax declarations are submitted for the basic reporting (tax) period, which is equal to the calendar year for the personal income tax payers, including self-employed individuals, until May 1 of year following reporting period, except for cases provided for in Section IV of the Code.

Paragraph 49.20 Article 49 of the Code stipulates that if the last day of a deadline for submitting tax declaration falls on a weekend or holiday, then the last deadline day is considered to be the operating (banking) day that follows the weekend or holiday.

As follows, citizens, individuals – entrepreneurs (except for individuals registered on the simplified taxation system) and individuals involved in independent professional activity, according to the 2022 results, taking into account requirements of the Law of Ukraine № 2136-IX as of 15.03.2022  "On the organization of labor relations during the martial law" submit tax declaration by May 1, 2023 (inclusively).

At the same time, please note that Article 166 of the Code stipulates that individuals – taxpayers, in compliance with requirements established by the specified Article of the Code, have right to submit tax declaration to exercise their right to the tax discount. Grounds for calculating tax discount with specific amounts are indicated by the taxpayer in the annual tax declaration, which is submitted by December 31 inclusively of the following tax year (Sub-paragraph 166.1.2 Paragraph 166.1 Article 166 of the Code). Copies of primary documents confirming right to the tax discount are submitted together with tax declaration (Sub-paragraph 166.2.2 Paragraph 166.2 Article 166 of the Code).