Ukrainian VAT explained simply: who pays and how it is calculated
VAT (PDV in Ukrainian) is a tax added to the price. The buyer pays it inside the price, the seller sends it to the budget. Each business in the chain pays only on the value it added. All rules below come from the Tax Code of Ukraine (TCU), version of 17.09.2026.
1. Who is a VAT payer
- Mandatory. Taxable sales over UAH 1,000,000 net of VAT in the last 12 calendar months (art. 181.1 TCU). Single tax payers of groups 1-3 are excluded.
- Voluntary. Any business may register by application, even below the threshold (art. 182.1 TCU).
2. Rates and exemptions
| Rate | Applies to | TCU |
|---|---|---|
| 20% | Standard rate | 193.1 «a», 194.1 |
| 14% | Wheat, barley, maize, soya, rapeseed, sunflower seed (UKTZED 1001, 1003, 1005, 1201, 1205, 1206 00) | 193.1 «g» |
| 7% | Medicines and medical devices, some cultural services, hotels, tickets to national and international sports events | 193.1 «v» |
| 0% | Export of goods and other operations of art. 195 | 193.1 «b», 195 |
| Exempt | For example licensed education, licensed medical services, baby food from the Cabinet list | 197 |
3. Output VAT, input VAT and an example
Output VAT (tax liability) is VAT on your sales. Input VAT (tax credit) is VAT on your business purchases. VAT payable = tax liability − tax credit for the month (art. 200.1 TCU).
A furniture workshop buys timber for 60,000 gross: input VAT 60,000 / 6 = 10,000. It sells tables for 120,000 gross: output VAT 20,000. VAT payable: 20,000 − 10,000 = 10,000. That is 20% of the 50,000 value it added.
Try your own numbers in the VAT calculator.
4. Returns, payment and tax invoices
- The tax period is one calendar month (art. 202.1 TCU).
- The return is due within 20 calendar days after the month ends (art. 203.1). Payment is due within the next 10 calendar days (art. 203.2).
- For each sale the seller issues a tax invoice and registers it in the Unified Register of Tax Invoices (art. 201.1). The registered invoice is the buyer's basis for input VAT (art. 201.10). See registration deadlines.
Hand tax invoice registration to run-done
The agent takes sales from 1C/BAS, builds and signs tax invoices and registers them on time. Status updates arrive in Telegram.