Do employers-single tax payers pay single contribution for employees called up for military service in the Armed Forces of Ukraine?

Law of Ukraine as of 15.03.2022 № 2120-IX "On amendments to the Tax Code of Ukraine and other legislative acts of Ukraine regarding validity of norms during the martial law" amended Section VIII "Final and Transitional Provisions" of the Law of Ukraine as of 08.07.2010 № 2464-VI "On collection and accounting of single contribution to obligatory state social insurance" with changes and amendments (hereinafter – Law № 2464).

Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464 determines that during the mobilization period, determined by Decree of the President of Ukraine as of 24.02.2022 № 69/2022 "On general mobilization" approved by the Law of Ukraine as of 03.03.2022 № 2105-IX "On approval of Decree of the President of Ukraine "On general mobilization", employers-single tax payers who chose simplified taxation system – individuals-employers belonging to Groups II and III of the single tax payers, as well as legal entities belonging to Group III of the single tax payers, have a right not to pay single contribution to obligatory state social insurance (hereinafter – single contribution) for employees called up during mobilization for military service in the Armed Forces of Ukraine (First clause of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464).

Amounts of single contribution accrued and not paid by employers, as is specified in the First clause of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464, are paid from the state budget except for periods in which employees, as is specified in the First clause of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464, received income in the form of cash security from which single contribution was paid from the state budget (Second clause of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464).

To determine amount of single contribution payable from the state budget, as is specified in the Second clause of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464, the single contribution payer calculates and reflects amount of single contribution for employees in the relevant reporting, as is specified in the First clause of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464, in amounts provided for in Parts 5 and 14 of Article 8 of the Law № 2464 (Third clause three of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464).

Reporting data on employees are used for calculation, as is specified in the First clause of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464, regarding amount of accrued income within the maximum amount for which the single contribution is accrued, amount of accrued single contribution, amount of accrued and reduced accrual of the single contribution of such employees (Fourth clause three of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464).

Based on the calculation, specified in the Third clause three of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464, the central body of executive power that implements the state tax policy, state policy on the administration of single contribution to obligatory state social insurance, forms budget requests for funds to cover the amounts unpaid single contribution by employers according to Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464 (Fifth clause three of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464).

Requirements for accrual of single contribution to wages (income) not exceeding the minimum wage established by the law per month are not applicable to wages (income) for the last calendar month (inclusively) when the actual demobilization of such employee was done (Sixth clause three of Paragraph 9 Note 20 Section VIII "Final and Transitional Provisions" of the Law № 2464).

More information is in the “Knowledge Base” of public information and reference resource