On 17 March 2022, Law No. 2120-IX “On amending the Tax Ordinance of Ukraine and other legislative acts of Ukraine on the validity of norms for the period of martial law” entered into force in Ukraine. The law provides for a number of tax exemptions, reductions in rates for fuel and defence-related goods, and tax breaks for charitable activities.

In temporarily occupied areas and in areas where warfare has taken place (or is currently taking place), exemptions are provided for:

  • land charges (land tax and rent for state or municipal owned land). Duration of the exemption – from March 2022 to 31 December of the year following the year in which martial law ceased/was lifted;
  • general minimum tax liability for plots of land located in such areas. Duration of the exemption – 2022 and 2023;
  • environmental tax. Period of exemption – 2022.

A significant part of the changes concerns the reduction of tax on fuel supplies and imports. During martial law, supplies and imports of fuel are exempt from excise duty and the VAT rate is reduced to 7%.

Charitable assistance received by veterans, civil protection force personnel and persons residing (living) in a locality where hostilities are (were) taking place and/or forced to leave such locations as a result of hostilities is exempt from personal income tax.

The tax relief for charitable giving by individuals in determining personal income tax has been increased from 4% to 16%. This means that the amount of income subject to personal income tax may be reduced by the amount of charitable donations or contributions to nonprofit organisations of up to 16% on the amount of income received.

More information can be found on our website: ukraine.lsw.com.pl. 

Should you have any questions or concerns, please do not hesitate to contact us: