Personal income tax (PIT) in 2025: what it is, who pays it, and how to calculate it

Everyone who receives official income in Ukraine pays tax on it. This is an amount deducted from wages, rent, dividends, cashback from banks, interest on deposits, or other income.

In this article, we explain what personal income tax (PIT) is, who pays it in 2025, what the rate is, how the tax is calculated and accrued, what benefits exist, and how to automate the process.

What is PIT in Ukraine?

PIT, or personal income tax, is a mandatory payment levied on citizens’ income: salaries, remuneration under civil law contracts, dividends, rent, and other income.

Individuals here include not only employees, but also sole proprietors under the general taxation system, as well as self-employed persons (lawyers, notaries, auditors, etc.).

In addition to PIT, the following are also withheld from the salaries of employees:

• military tax — 5%;
• single social contribution — 22%.

Who pays personal income tax in 2025?

According to the Tax Code of Ukraine, all individuals who are citizens of Ukraine and receive official income both within the country and abroad are required to pay personal income tax. They can be divided into several categories:

• Salaried employees. In fact, it is not the employees themselves who pay personal income tax, but their employer, who is responsible for calculating the amounts and transferring the funds to the budget.
• Individual entrepreneurs under the general taxation system. Individual entrepreneurs must calculate the amount of income tax themselves and pay it on time to avoid penalties.
• Self-employed persons. Lawyers, notaries, auditors, and other independent professionals pay tax on income from their activities.
• Landlords. Owners of movable and immovable property that is leased. If you receive income from renting out an apartment, car, other transport, or equipment, this income is also taxable.
• Foreign citizens who receive income in Ukraine. In such cases, taxes are paid by tax agents from whom non-residents receive their income.
• Sellers of real estate, cars, and other property must also pay taxes.
• Individuals who receive passive income (inheritance, gifts, lottery winnings, investment income). If you win the lottery or receive an inheritance, this is considered passive income and is also taxable. For example, you will not receive your lottery winnings in full, but after deduction of the tax amount, which the organizer will withhold and transfer.

What is the personal income tax rate in 2025?

According to Article 167 of the Tax Code of Ukraine (TCU), the base personal income tax rate in Ukraine in 2025 will be 18%.

Some types of income are taxed at special rates of 0%, 5%, or 9%.

In 2025, certain types of income will be taxed at the following rates:

How to calculate personal income tax?

Universal calculation formula:

Personal income tax amount = Income × Personal income tax rate

Military tax is calculated additionally: Income × 5%.

When calculating wages, military tax of 5% is calculated additionally.

Let’s look at how personal income tax is calculated in different situations.

📌 Example 1. Calculation of personal income tax from wages

If an employee is paid a salary of UAH 20000, taxes are calculated as follows:

1. Personal income tax amount: UAH 20000 × 18% = UAH 3600
2. Military tax: UAH 20000 × 5% = UAH 1000
3. Total amount of taxes: UAH 3600 + UAH 1000 = UAH 4600
4. Amount to be paid: UAH 20000 – UAH 4600 = UAH 15400

📌 Example 2. Calculation of personal income tax on rent

If an individual rents out an apartment and receives a monthly income of UAH 10,000, taxes are calculated as follows:

1. Personal income tax amount: UAH 10000 × 18% = UAH 1800
2. Military tax: 10000 UAH × 5% = 500 UAH
3. Total taxes: 1800 UAH + 500 UAH = 2300 UAH
4. Net income: 10000 UAH – 2300 UAH = 7700 UAH

📌 Example 3. Calculation of personal income tax for an individual entrepreneur under the general taxation system

If an individual entrepreneur received income of UAH 500000 for the year and incurred expenses of UAH 300000, taxes are calculated as follows:

1. Net taxable income: UAH 500000 – UAH 300000 = UAH 200000
2. Personal income tax amount: UAH 200000 × 18% = UAH 36000
3. Military tax: UAH 200000 × 5% = UAH 10000
4. Total tax amount: UAH 36000 + UAH 10000 = UAH 46000

Calculation of personal income tax

Calculation of personal income tax means determining the amount of tax to be paid on a specific income.

• Employer: when calculating salaries, the accountant simultaneously generates entries for personal income tax and military tax deductions. The employer then transfers these amounts to the budget.
• Individual entrepreneurs and self-employed persons: independently calculate their income, take into account expenses, and pay tax to the budget.
• Landlords: determine the amount of tax on rent and pay it quarterly.

What income is not taxable?

According to Art. 165 of the Tax Code of Ukraine, tax is not levied on the following types of income:

• scholarships, if their amount does not exceed the non-taxable minimum (UAH 4240);
• alimony;
• social assistance;
• pensions;
• income from the sale of real estate, if it has been owned for more than 3 years and this is the first sale of the year;
• income from the sale of cars (passenger cars, motorcycles, and mopeds), if it is the first sale in a year;
• inheritance and gifts from relatives of the 1st and 2nd degree of kinship (parents, spouse, children, brothers/sisters, grandchildren).

Payment of personal income tax

📆 Deadlines for payment of personal income tax in 2025

The deadlines for payment of personal income tax in 2025 are specified in Art. 168 of the Tax Code of Ukraine:

• Employers must pay personal income tax on salaries within 30 days of their accrual.
• If income is provided in non-monetary form or in cash from the tax agent’s cash desk, personal income tax is paid to the budget within 3 banking days from the date of accrual.
• Individual entrepreneurs make advance payments on a quarterly basis and pay the final amount of tax by August 1.
• Landlords transfer income tax on a quarterly basis (payment by the 20th day of the month following the reporting quarter).

Important: if the tax agent has accrued income but has not paid it, personal income tax must be transferred to the budget within the time limits established by the Tax Code for the monthly tax period (i.e., no later than 30 calendar days after the month of income accrual) (P.168.1 of the Tax Code).

💳 To which account should personal income tax be paid?

The current details for paying personal income tax are listed on the official website of the State Tax Service of Ukraine in the section «Accounts for payment of taxes». There you will find information for each city and explanations of where the taxes are paid. You can also find the details at your local tax office or through the taxpayer’s electronic office.

Be sure to indicate the payment type code in the payment description, for example, «101 PIT for…». If you find errors in your calculations or circumstances affecting the tax amount have changed, it is possible to recalculate the PIT. To do this, submit a revised tax return.

Common mistakes when paying personal income tax

• Incorrect payment purpose (payment type code).
• Late payment, resulting in fines and penalties.
• Failure to take military tax into account.
• Errors in calculations (especially for sole proprietors).

PIT reporting in 2025

Starting in 2025, tax agents must submit monthly reports on PIT, military tax, and social security contributions. Tax calculations must be submitted within 20 calendar days after the end of the reporting month.

The new tax calculation form, approved by the Ministry of Finance of Ukraine, consists of the main calculation and four appendices:

• information on social security contributions;
• information on income;
• data on labor relations;
• information on special seniority.

Liability for non-payment of personal income tax

Penalties and interest are charged for late payment of personal income tax:

• 5% of the amount owed for delays of up to 30 days;
• 10% for delays of more than 30 days;
• 25% for deliberate tax evasion.

Penalties are charged daily, starting from the first working day after the deadline, at a rate of 120% of the annual discount rate, provided by the National Bank of Ukaine, for each day of debt.

Penalties for late payment of personal income tax during martial law are applied in the usual manner if the taxpayer was able to fulfill their obligations. In cases of non-fulfillment of tax obligations, losses and damages incurred by the taxpayer due to additional payments may be taken into account.

Personal income tax benefits

Personal income tax payers who receive a salary are entitled to a tax social benefit (TSB). This is the amount by which the accrued salary is reduced before taxation. The TSB applies if the employee’s monthly income does not exceed the established limit.

In 2025, the following types of tax social benefits are in effect:

To receive a tax social benefit, an employee must submit an application to their employer. The amount of the benefit cannot exceed the amount of the salary.

How to automate personal income tax payments

Today, providers offer individual entrepreneurs digital services that automate personal income tax payments. For example, Vchasno.Zvit is a service for individual entrepreneurs that simplifies reporting and tax payments. Taxpayers can take advantage of the following service features:

• Tax calendar. The service automatically tracks all important dates and sends advance notifications about upcoming reporting and tax payment deadlines. This helps sole proprietors avoid the risk of fines for late tax payments.
• Automatic tax calculation. Sole proprietors enter their income data into the service, and Vchasno.Zvit independently calculates the exact amount of personal income tax, military tax, and social security contributions that need to be paid. This minimizes the likelihood of errors that often occur with manual calculations.
• Automatic report generation. Based on the income data entered, the service automatically generates the necessary reports. They are created in the correct format in accordance with current legal requirements. The user only needs to check the data and sign the report with an electronic signature.

PIT is one of the key taxes paid by individuals in Ukraine. Both employees and employers need to know the current PIT calculation rules in order to plan their budget and prepare tax reports correctly.

Automating the processes of calculating and paying PIT helps to avoid confusion in reporting and, as a result, penalties. Use the capabilities of the Vchasno.Zvit service to protect yourself from mistakes even during periods of high workload.

Conclusion

PIT is one of the key taxes in Ukraine, paid by almost all citizens. It is important for employees, sole proprietors, and employers to know the rates, accrual dates, and payment deadlines.

To avoid confusion and penalties, it is worth automating tax reporting — this is easy to do in the Vchasno.Zvit service.