Sole proprietor taxes in Ukraine in 2026: what groups 1, 2 and 3 pay

What sole proprietor taxes depend on in 2026

A sole proprietor (FOP, from the Ukrainian “fizychna osoba-pidpryiemets”) on Ukraine's simplified tax system pays amounts that are almost all tied to two figures set by the 2026 state budget law:

• the minimum wage, UAH 8,647 a month: the group 2 rate, the military levy for groups 1-2, the minimum ESV and the income limits are calculated from it;
• the subsistence minimum for able-bodied persons, UAH 3,328: the group 1 rate is calculated from it.

A sole proprietor on the single tax makes three mandatory payments: the single tax, the military levy and the single social contribution (ESV) for themselves. ESV counts towards pension insurance experience, so your future pension depends on it.

Rates and income limits for 2026

The group 1 and 2 rates are maximums. The exact rate for your community is set by the local council and may be lower, so check your council's decision or the tax office data.

The minimum ESV is 22% of the minimum wage: 8,647 × 22% = UAH 1,902.34 a month, or UAH 5,707.02 a quarter.

What a sole proprietor pays per month: examples

Group 2 or group 3: which pays off

ESV is the same in both groups, so you only need to compare the single tax and the military levy. In group 2 that is a fixed UAH 2,594.10 a month; in group 3 without VAT it is 6% of income.

The break-even point: 2,594.10 / 0.06 = UAH 43,235 of income a month. If your income is consistently lower, group 3 is cheaper. If it is higher, group 2 pays off.

The tax amount is not the only criterion, though. Group 2 has restrictions: services, production and sale of goods only to individuals and other single tax payers, no more than 10 employees, and some types of activity are not allowed. If your clients are companies on the general tax system or foreign customers, you usually have no choice: you need group 3. Group 1 suits only retail trade at markets and household services to individuals, without employees.

Payment deadlines

• Groups 1 and 2: single tax and military levy monthly, no later than the 20th of the current month. You can prepay for a quarter or a year, but not beyond the end of the current year.
• Group 3: single tax and military levy quarterly, after filing the quarterly tax return.
• ESV for yourself: quarterly, by the 20th of the month after the quarter. In practice the tax office reads “by the 20th” as “no later than the 19th”, so don't leave it to the last day.

Reporting: groups 1 and 2 file a tax return once a year, group 3 quarterly.

Who may not have to pay ESV for themselves

For most group 1-2 sole proprietors, the minimum ESV is the largest payment, so the exemptions are worth knowing. Among others, ESV for yourself may not be due for:

• sole proprietors who also work under an employment contract, if the employer paid at least the minimum ESV for them;
• sole proprietors who receive an old-age pension, or have a disability and receive a pension or social assistance;
• mobilised sole proprietors, for the whole period of service.

Voluntary ESV payments remain possible and add to your pension insurance experience.

Sole proprietor or employee: how much goes to tax

For comparison, take the same cost to the client: UAH 36,600 a month.

From an employee with a UAH 30,000 salary, 18% income tax and the 5% military levy are withheld, and the employer pays 22% ESV on top. The take-home pay calculator shows how it is calculated.

Common mistakes

• Exceeding the limit. Income above the limit is taxed at a higher rate, and the sole proprietor has to move to another group or the general system. Track your income on a running total from the start of the year.
• The wrong group for your clients. Working with companies on the general system while in group 2 breaks the group's conditions.
• Missed deadlines. Late payment brings fines and penalty interest. Set a reminder for the 15th.
• Paying taxes from a personal card “whenever”. Keep a separate business account and set aside tax from every payment: in group 3 it is handy to put aside 6% plus a share of ESV straight away.

In short

• The 2026 basis: minimum wage UAH 8,647, subsistence minimum UAH 3,328.
• Group 1: up to UAH 3,099.84 a month, limit UAH 1,444,049 a year.
• Group 2: up to UAH 4,496.44 a month, limit UAH 7,211,598 a year.
• Group 3: 5% (or 3% with VAT) + 1% military levy + UAH 1,902.34 ESV, limit UAH 10,091,049 a year.
• Group 2 beats group 3 at income above UAH 43,235 a month, if your clients allow you to choose it.
• ESV for yourself by the 20th after the quarter; single tax and levy for groups 1-2 by the 20th of the current month.

Sources

1. State Tax Service, Chernivtsi region - Q&A for single tax payers of groups 1-2 in 2026 (in Ukrainian)
2. Debet-Kredyt, based on the State Tax Service, Kyiv region - group 3 sole proprietor taxes in 2026 (in Ukrainian)
3. State Tax Service, Ternopil region - group 3 single tax and the 1% military levy (in Ukrainian)
4. Debet-Kredyt - ESV for sole proprietors in 2026: minimum contribution, deadlines, exemptions (in Ukrainian)

This article is for information only and is not tax advice. Single tax rates for groups 1 and 2 are set by local councils; the article gives the maximum rates. Before choosing a group or registering as a sole proprietor, check the current rules on the State Tax Service website or consult an accountant.