Verkhovna Rada of Ukraine passed the law introducing new framework for taxing income earned by individuals through digital platforms. The Law requires platform operators to withhold tax from such income at a reduced tax rate of 10%. The new rules apply to both domestic and foreign platforms.
Key Takeaways
Law No. 4903-IX, adopted on 9 June 2026, was informally dubbed "OLX tax", by the name of one of the country's most popular online marketplaces. The Law introduces a new tax framework for digital platforms that connect sellers of goods and services with consumers. In addition to marketplaces such as OLX, the Law applies to food delivery platforms, ride-booking services, accommodation booking platforms and many other digital services.
The key changes introduced by the Law include the following:
- Platform operators become tax agents
The operator will be responsible for withholding and remitting tax to the state budget and for filing the required tax reporting.
A platform operator is defined as an entity that contractually provides access to a platform to other persons. This may include Ukrainian and foreign companies, as well as legal arrangements such as trusts, foundations, or partnerships.
A seller is defined as an individual registered on the platform to carry out certain types of activity ("reportable activities"). Reportable activities include, among others, sale of goods and provision of personal services. Importantly, the activity does not necessarily need to take place in Ukraine.
- A reduced 10% tax rate applies subject to eligibility criteria
Income earned by an individual through a platform will be taxed at a preferential 10% rate (as compared to standard 23% income tax rate), provided that all of the following conditions are met:
- the seller is a Ukrainian tax resident, does not engage employees and is not subject to sanctions
- the seller does not sell excisable goods through the platform (e.g., alcoholic beverages or tobacco products)
- remuneration is credited exclusively to an account opened with a Ukrainian bank or licensed non-bank payment service provider, and the relevant account details are disclosed to the platform operator
- settlements with the seller are made exclusively in monetary form (cash or non-cash)
- the platform operator is included in the Register of Platform Operators maintained by the State Tax Service of Ukraine
If these conditions are not satisfied, income may become subject to the standard 23% tax rate.
Where eligibility is lost after reportable activity has already commenced (for example, where a seller starts selling excisable goods through the platform), the seller transitions to the 23% rate from the first month of the calendar quarter in which the breach occurred. The seller may regain eligibility for the preferential rate after remedying the breach, but no earlier than from the beginning of the following calendar year.
- The 10% regime is subject to an annual income cap
The preferential 10% rate applies only to income not exceeding 834 minimum monthly salaries determined as of 1 January of the relevant reporting year (UAH 7,211,598 for 2026, or approx. EUR 141,800). If the seller’s annual income exceeds this threshold, the excess amount becomes taxable at the standard 23% rate, with credit given for tax already withheld. In this case, the seller will also be required to file an annual tax return.
- Limited exemption for sales of goods
Income from the sale of goods up to an aggregate amount of EUR 2,000 per year is excluded from taxable income altogether.
No similar exemption is available for other categories of reportable activity carried out through platforms, including the provision of services.
- Monthly tax payments and annual reporting
Tax must be remitted to the state budget on a monthly basis – by the 30th day of the month following the month in which income is accrued. At the same time, reporting on sellers’ income is filed annually, by 31 January of the year following the reporting year. Income reported under the platform reporting rules will not be included in the standard tax withholding return covering payments made to individuals.
- Relationships between platform operators and sellers are not treated as employment
The Law expressly provides that relationships between a platform operator and an individual seller are not regarded as employment relationships. This allows for a cautious argument that remuneration earned by sellers through platforms should not be subject to Ukrainian unified social contribution (USC). At the same time, the Law does not introduce amendments to the legislation governing USC, nor does it contain an explicit provision excluding such remuneration from the social security contribution base. As a result, the issue may require further clarification in administrative practice.
- Platform operators must register with the Ukrainian tax authorities
Platform operators, including foreign operators, will be required to register with the State Tax Service of Ukraine. Failure to register may result in financial penalties and, ultimately, court-ordered restriction of access to the platform in Ukraine. In addition, where a platform operator is not registered, the preferential 10% regime will not be available and the relevant income may instead become subject to taxation at the standard 23% rate.
- Interaction with individual entrepreneur (FOP) status
The mere fact that a seller is registered as an individual entrepreneur (FOP) does not itself prevent application of the special tax regime introduced by the Law. However, where the seller is registered on the platform specifically in the capacity of an individual entrepreneur, taxation will continue to follow the rules applicable to FOPs under the selected tax regime (general or simplified).
Regulatory Context and Background of the Reform
The rapid expansion of the digital economy has created significant challenges for traditional tax administration systems. Economic activity conducted through online platforms has often remained outside effective fiscal oversight, creating conditions for underreporting and non-payment of taxes on a substantial portion of individuals’ income. To address these challenges, the Organization for Economic Co-operation and Development (OECD) developed the Model Reporting Rules for Digital Platforms (MRDP). Within the European Union, these standards were implemented through Council Directive (EU) 2021/514 (DAC7), which introduced a harmonized framework for reporting income earned by sellers operating through reportable platforms.
For Ukraine, implementation of these standards serves not only as an instrument for strengthening domestic tax administration and revenue mobilization but also constitutes an important element of the country’s commitments to the International Monetary Fund and part of the broader European integration agenda.
Scope of Application
The Law applies broadly to both platform operators and sellers.
A platform is defined as software in any form (including websites and mobile applications) that enables sellers to connect with users for purposes of carrying out reportable activities.
The concept of reportable activity covers the following categories:
- sale of goods (defined broadly as any object recognised as property under the Civil Code of Ukraine, excluding digital assets)
- provision of personal services (services or works performed online or offline for a user over a period of time)
- rental of immovable property (including residential and commercial property and parking spaces)
- rental of means of transport
Examples of digital platforms that may potentially fall within the scope of the Law include:
- marketplaces for sale of goods (e.g., OLX, Bigl)
- platforms for provision of services (e.g., Kabanchik, Upwork)
- delivery platforms (e.g., Glovo, Bolt Food, Uklon Delivery)
- ride-booking platforms (e.g., Uklon, Bolt, Uber, BlaBlaCar)
- accommodation rental and booking platforms (e.g., Booking.com, Airbnb)
At the same time, the Law does not apply to software whose functionality is limited to processing payments, advertising or information services, or redirecting users to another platform. This may potentially exclude, for instance, classified ads services and payment service providers – provided that their functionality does not extend beyond such limited activities and they do not otherwise participate in facilitating reportable activity.
Registration of Platform Operators
A platform operator is an entity (a company or another arrangement without legal personality) that contractually provides sellers and users with access to a platform.
Ukrainian platform operators (i.e., Ukrainian tax residents) are required to register in all cases.
Foreign platform operators are required to register where:
- they maintain a permanent establishment or place of effective management in Ukraine
- sellers who are Ukrainian tax residents carry out reportable activities through the platform
- the platform facilitates reportable activity consisting of rental of immovable property located in Ukraine
Operators existing as of 1 November 2026 will apparently be required to complete registration with the State Tax Service by 1 January 2027.
New operators (that is, those entered the market after 1 November) will be required to register within 60 days from granting access to the platform and, in any event, before any remuneration is credited to individual sellers.
Registration will be conducted with the State Tax Service based on an application submitted by the operator.
The detailed registration procedure is expected to be adopted by the Ministry of Finance by 1 November 2026. Notably, one of the grounds for the tax authorities to deny registering a platform operator is a finding that the relevant software does not meet the legal definition of a platform. The Law does not specify the procedure or evidentiary standard for making such determination, which may ultimately need to be addressed in secondary legislation.
Entry into Force
The Law awaits to be signed by the President of Ukraine. Although the Law formally enters into force on the day following its official publication, its key provisions will become effective later.
In particular:
- the special tax regime introduced by the Law will apply from 1 January 2027
- registration obligations for platform operators will arise from 1 November 2026. Before that date, the Ministry of Finance and the State Tax Service are expected to adopt the necessary implementing acts (including registration procedures and application forms) and complete preparations required for administration of the regime
Ukraine is also expected to accede to the DPI Multilateral Competent Authority Agreement.
Accession to the DPI framework appears to be a key practical precondition for implementation of the new regime. Until Ukraine becomes a participating jurisdiction under the agreement, the platform registration rules are unlikely to become operational, which in turn may delay practical application of the preferential 10% regime.
Penalties
The Law introduces a broad system of sanctions applicable to platform operators.
Failure to register as a platform operator
Failure to submit a registration application within the required period (60 days from commencement of relevant activity) is subject to a penalty of 20 minimum monthly salaries (UAH 172,940, or approx. EUR 3,380). Payment of the penalty does not relieve the operator from the obligation to register.
If the penalty remains unpaid for more than 10 business days after assessment, the tax authority may apply to court seeking restriction of access to the platform in Ukraine. Access restrictions remain in effect until registration is completed.
Failure to submit annual seller reporting
Failure to submit the annual report on reportable sellers’ income triggers a penalty of 100 minimum monthly salaries (UAH 864,700, or approx. EUR 16,906). Late submission of the report or corrected filing is subject to a penalty of 0.5 minimum monthly salary (UAH 4,323.50, or approx. EUR 85) for each calendar day of delay.
Submission of incomplete or inaccurate reporting
Submission of incomplete or inaccurate information is subject to a penalty of 0.5 minimum monthly salary per affected seller. Where the violation is intentional or results from failure to perform appropriate due diligence procedures, the penalty increases to 5% of aggregate remuneration paid to the relevant seller through the platform, subject to a minimum threshold of 1 minimum monthly salary (UAH 8,647, or approx. EUR 170).
Recordkeeping and compliance failures
Failure to comply with document retention obligations (minimum retention period — five years / 1,825 days) or failure to block non-compliant sellers results in a penalty of 1 minimum monthly salary.
Where such breach results in omission of seller information from reporting, the penalty increases to 50 minimum monthly salaries (UAH 432,350, or approx. EUR 8,453).
Simplified tax reporting for non-residents
Failure to submit, or late submission of, simplified tax calculations applicable to non-resident operators triggers a penalty of 20 minimum monthly salaries (UAH 172,940, or approx. EUR 3,381).
Failure to pay taxes withheld from sellers
Failure by the platform operator to pay tax liabilities attributable to sellers is subject to a penalty equal to 10% of the unpaid amount (25% where the violation is intentional, 50% for repeated violations (twice within three years), and 75% for three or more violations within three years.
Practical Implications and Next Steps
Implementation of the Law will require adoption of a substantial body of secondary legislation, without which platform operators are unlikely to be able to fully integrate the new rules into their business operations.
Nevertheless, certain preparatory steps should already be considered. In particular, companies operating software that facilitates interaction between sellers and consumers of goods or services should conduct an initial applicability assessment and determine whether their software falls within the statutory definition of a platform, and whether registration and tax agent obligations are likely to arise.
For some operators, however, the answer to these questions may already be evident – especially given that certain market participants actively supported and advocated for the adoption of the new framework. Such operators should consider commencing a comprehensive review of their legal, tax, and operating models and identifying the adjustments necessary to align their business processes with the new regulatory requirements.
For further information, please contact Asters Partner Constantin Solyar and Senior Associate Yurii Dmytrenko.
