VAT in Ukraine

1. What is the VAT in Ukraine?

VAT was introduced in Ukraine in 1993 and on 1st January 2011 it began to be administered by the Ukrainian State Tax Administration. The standard VAT rate in Ukraine is 20%. However, this rate is expected to become lower in 2014. Exports are zero-rated in Ukraine. Some goods and services such as consulting, engineering, IT services, medical products, prepared baby food products or newspapers are not subject to VAT in Ukraine. Education, healthcare and religious services are exempt from VAT in Ukraine.

2. How can I get a VAT refund in Ukraine?

Foreign entities cannot apply for VAT refund in Ukraine. However, companies that are registered for VAT purposes in Ukraine can obtain a VAT refund only if the company meets the requirements of the tax authorities. It is mandatory that all invoices are kept and some information is provided about the company. If the amount of a tax invoice exceeds 100,000 UAH, the company must register the invoice with the Unified Register of Tax Invoices. It is planned that companies in Ukraine receive automatic VAT refund.

3. How can I register for VAT in Ukraine?

All companies that perform activities which are subject to VAT in Ukraine must register for VAT with the Ukrainian tax authorities. VAT registration in Ukraine is also compulsory for foreign companies that perform production and commercial activities which are subject to VAT in Ukraine.  Registration for VAT in Ukraine begins when a declaration form is submitted. If one of the company’s owners cannot go in person to the relevant tax authorities’ office, a representative may be appointed by power of attorney.

4. How does intra-community VAT work in Ukraine?

No intra-community VAT is applied in Ukraine, since Ukraine is not a member state of the European Union and transactions with other countries that are EU members are not considered to be within community.