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Ukraine

14 January 2022

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Ukraine Clarifies Social Tax Benefit Deduction for Individuals in 2022

The Ukraine State Tax Service has issued a release clarifying the application of the social tax benefit deduction for individuals in 2022. The monthly deduction from taxable employment (salary) income is equal to 50% of the minimum subsistence level for able-bodied persons, which has been set at UAH 2,481 from 1 January 2022, and may generally be claimed by individuals earning monthly employment income not exceeding 1.4 times this minimum subsistence level, rounded off to the nearest UAH 10. As such, the monthly social tax benefit deduction for 2022 is equal to UAH 1,240.50 (50% of UAH 2,481) for individuals earning monthly employment income of UAH 3,470 (1.4 x UAH 2,481 rounded off) per month or less.

However, individuals may qualify for a higher maximum employment income amount if they have more than one child. In this case, one parent may claim a higher amount equal to up to 5 times the standard maximum (for up to 5 children). The deduction amounts may also be increased up to 100% of the minimum subsistence level for certain individuals, including single parents, taxpayers with a disabled child, "Heroes of Ukraine" and war veterans, and certain others.

Note, the general minimum subsistence level is set at UAH 2,393 from 1 January 2022, UAH 2,508 from 1 July 2022, and UAH 2,589 from 1 December 2022, with varying levels also set for different categories of persons. For able-bodied persons, increases to UAH 2,600 and UAH 2,684 are scheduled from 1 July 2022 and 1 December 2022.

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