Taxes for individual entrepreneurs have been reduced. What are the next steps for an entrepreneur?

Due to the quarantine, the Cabinet of Ministers decided to ease the tax burden on entrepreneurs.

Single social contribution (SSC)

Who is exempt from payment?

From March 1 to April 30, the following persons are exempt from paying the unified social contribution "for themselves":

• Individual entrepreneurs;
• persons engaged in independent professional activities;
• members of farms.

How much are we talking about?

The unified social contribution is paid at the rate of 22% of the salary. It can be paid monthly or quarterly. There is a minimum and a maximum amount:

• The minimum unified social contribution in 2020 is UAH 1039.06 per month (4723 * 22% = 1039.06).
• The maximum unified social contribution is equal to 15 times the minimum wage. In 2020, it is equal to UAH 15,585.90 per month ((4723 * 15) * 22% = 15585.90).

Entrepreneurs independently determine the amount of payroll to pay the unified social contribution.

What should I do if I paid the unified social contribution ahead of time?

If you pay the unified social contribution on a monthly basis and have paid for March and April by March 18, you do not need to take any additional actions in this situation. The tax authorities will credit such amounts against future payments without any applications from you. And March and April will still be included in your insurance period.

What if I still want to pay the unified social contribution?

If you want to pay the unified social contribution "for yourself" for March and April, no one deprives you of this right. To do this, you transfer funds to the Treasury account within the specified timeframe, and in the "Report on the amounts of accrued income of insured persons and the amount of accrued single contribution" (Annex 5) for 2020, you will need to indicate such amounts for March and April.

That is, when filling out the 2020 Report, you will have two options for filling it out:

1. If you decide to take advantage of the exemption and not pay the unified social contribution for two months, you put zeros in the appropriate columns of the report;
2. If you decide not to use the benefit and pay the unified social tax for two months, you should record the amount of the salary on which you paid the unified social tax and the amount of the tax itself in the appropriate columns of the report.

What violations of the unified social contribution will not be fined?

The following violations are temporarily exempt from fines until May 31:

• late payment of the unified social contribution;
• incomplete payment of the unified social tax;
• untimely submission of unified social tax reports.

Single tax (ST)

Who is exempt from payment?

Law No. 540 authorizes local governments to make decisions to reduce the amount of local taxes and fees. This means that they can independently reduce the amount of the single tax for groups I and II of individual entrepreneurs in 2020. For Group III, the rates cannot be reduced, as their amount is set by the Tax Code, and local councils do not have such powers.

How much are we talking about?

The amount of the single tax is set differently for individual entrepreneurs of groups I and II:

• For Group I, the amount of the EH is equal to 10% of the subsistence minimum as of January 1 of the current year. In 2020, it is equal to UAH 210.20;
• For Group II, the amount of the EH is 20% of the minimum wage set as of January 1 of the current year. In 2020, it is equal to UAH 944.60.

Where can I find out about the reduction of the EH rate?

In order to find out about the reduction of the unified tax rate, you need to contact local councils at the tax address or check the official website of the local council. Since such a decision, order or resolution is an official document, it is made public. Be sure to read such a document carefully and, if you have any questions, seek advice from the tax office.

If the EHT rate is reduced, do I need to submit an additional application to exercise this right?

No, it is not required. In case of change in the amount of the UT, a village, town or city council does not have to submit an application for the simplified taxation system for single tax payers of groups I and II.