On December 23, 2009 the State tax administration of Ukraine issued letter No. 28593/7/17-0717 “On Taxation of Foreigners’ and Non-residents’ Income”, which inter alia clarifies on how a foreign individual can get a status of a local tax resident in Ukraine. For this purpose the foreigner’s employer should receive a Notification from the competent tax office that the foreign individual may independently decide his/her tax status in Ukraine. As soon as the said Notification is issued the foreigner receives the status of a Ukrainian tax resident, hence his/her labor income received from employer (salary) is subject to taxation according to the general rule set forth by the Ukrainian Law No. 889 “On Individuals’ Income Tax” dated 22 May 2003, Section 7.1, i.e. at fifteen percent. Otherwise, the foreign individual’s salary as well as any other income received from any activities shall be taxed at 30%.
In order to get the Notification from the tax office that a foreign individual enjoys the status of tax resident, a set of documents should be submitted, and among other documents a copy of the temporary residence permit, work permit and the document from the State frontier service about the foreigner’s term of stay in Ukraine. The procedure of receiving the Notification lasts approximately 1 month.
We kindly ask you to take the above amendments into consideration and contact us in case if you consider these new regulations might have legal consequences for you.