Features of sick leave and maternity benefits for sole proprietors

On January 4, 2025, Law No. 4158 on state social insurance was officially published. The document includes provisions granting workers the right to receive sick leave benefits both at their primary place of employment and under secondary employment. This refers specifically to financial assistance for temporary disability and maternity leave.

The law officially takes effect on April 4, 2025. What will change for Sole Proprietorships, and what specific payment conditions should everyone prepare for?

When is a Sole Proprietorship entitled to sick leave benefits from the Pension Fund of Ukraine?

The Pension Fund of Ukraine provides insurance payments only to insured individuals, meaning those who pay the single social contribution (SSC). This rule also applies to Sole Proprietorships.

Thus, the right to receive sick leave benefits from the Pension Fund arises in the event of an insurance case during business activities.

It is worth noting that as of January 1, 2025, the government has canceled wartime exemptions for voluntary SSC payments for Sole Proprietorships. Entrepreneurs are once again required to pay this tax. Therefore, those who previously took advantage of the exemption and did not pay SSC will not be able to receive sick leave benefits. The right to receive financial aid will only arise after paying SSC for at least 2–3 months.

However, an exception applies to Sole Proprietorships who are also employed. According to Law No. 2464, they do not pay SSC for themselves. A Sole Proprietorship employed at their primary workplace may be classified as a SSC payer if their employer has paid contributions on their behalf. Moreover, the law does not allow voluntary SSC payments for such individuals.

As a result, a Sole Proprietorship who is also an employee cannot receive sick leave benefits as an entrepreneur.

How to correctly calculate sick leave benefits for Sole Proprietorships?

When calculating financial compensation, the Sole Proprietorship's income on which SSC was paid is considered.

To determine this, the average daily income for the 12 months preceding the insurance case must be calculated. For example, if the sick leave starts in July 2024, the calculation period will be from July 2023.

The average daily rate is determined as follows: total business income divided by the number of days in the calculation period.

The resulting amount is then adjusted by a coefficient depending on the total insurance record:

• 8 years or more — 100%;

• 5 to 8 years — 70%;

• 3 to 5 years — 60%;

• Less than 3 years — 50%.

The Pension Fund starts covering sick leave from the sixth day. The first days of disability are self-funded by the Sole Proprietorship.

What documents are required to receive sick leave benefits?

To receive sick leave payments from the Pension Fund, the Sole Proprietorship must submit a claim via the electronic portal of the government service. A paper version of the application can also be submitted to the nearest Pension Fund service center.

Additionally, the following documents are required:

• A certificate confirming SSC payments and no outstanding debts for the calculation period;

• A copy of the tax return submitted to the tax office, showing declared SSC payments;

• A certificate of a dedicated bank account for receiving payments;

• A copy of the OK-7 form showing reported wages and SSC payments.

The insurance record will be verified based on these documents.

Maternity benefits for Sole Proprietorships in 2025

The amount of maternity benefits for Sole Proprietorships does not depend on their tax group.

According to the Tax Code, maternity leave is treated as sick leave and is considered temporary incapacity lasting 30 or more days. As a result, Sole Proprietorships in tax groups 1 and 2, if they have no employees, may be exempt from taxes during maternity leave. A Sole Proprietorship in tax group 3 may also be exempt from taxes if there is no income during this period.

Entrepreneurs are also exempt from personally submitting tax reports, as they can do so electronically via the tax authority’s online portal.

How are maternity benefits calculated for Sole Proprietorships?

Maternity benefits are calculated based on the 12 months preceding the maternity leave application. The insurance period (time during which SSC was paid) is taken into account.

If the insurance period is less than six months, sick leave benefits will be limited and calculated based on actual business income but not exceeding two minimum wages.

In some cases, a Sole Proprietorship may be eligible for 140 paid maternity leave days, for example, due to complications during childbirth.

Any woman operating as a Sole Proprietorship who has paid SSC for 12 months (22% of the minimum wage, i.e., 1760 UAH) is entitled to maternity benefits.

How is maternity leave compensation paid to Sole Proprietorships?

To receive financial compensation for maternity leave, a Sole Proprietorship must complete the following steps:

• Pay the Single Social Contribution (SSC).

• Close the sick leave case.

• Submit a tax declaration to the tax office.

• Prepare and submit an application to the Pension Fund for benefit payment.

All these actions can be completed remotely through the personal electronic portal. An electronic signature is required to authenticate documents.

Sole Proprietorships who, for any reason, cannot use the electronic portal can submit paper documents in person at any Pension Fund service center.

Once the application is submitted, the Sole Proprietorship must open a social account in a bank, where the benefit payments will be transferred. The Pension Fund will send a confirmation letter regarding the application receipt and its review status.

Upon receiving the funds, the entrepreneur must notify the Pension Fund. Maternity benefits are not subject to taxation.

Is a Sole Proprietorship required to pay SSC during maternity leave in 2025?

All Sole Proprietorships are required to pay the Single Social Contribution (SSC). Maternity leave does not exempt entrepreneurs from this obligation. However, Sole Proprietorships under the simplified tax system can determine their contribution amount independently. Even in the absence of income, they must pay at least the minimum SSC amount set by law.

Can a Sole Proprietorship work under secondary employment?

A Sole Proprietorship cannot be officially employed under a labor contract as a secondary job. However, they can work under secondary employment as an individual.

In this case, maternity and sick leave payments in 2025 will be made according to the new rules established in Law No. 4158. That is, benefits can first be obtained at the primary place of employment (from the employer), and then under secondary employment, provided there is a valid document confirming temporary disability.