Ukraine Outlines Taxation Framework for Virtual Assets with 18% Personal Income Tax
Ukraine's National Securities and Stock Market Commission (NSSMC) has introduced a taxation matrix for virtual assets (VAs), establishing a clear tax model that includes an 18% personal income tax and a 5% military levy.
According to the information the proposal also provides for preferential rates of 5% and 9%. The document was shared by NSSMC head Ruslan Magomedov via Telegram on Tuesday.
Magomedov emphasized the urgency of defining cryptocurrency taxation, calling it a “rapidly approaching reality” in the digital age. The NSSMC’s framework for virtual asset taxation considers various transaction types, from mining to airdrops. It draws inspiration from international tax practices, tailored for Ukraine’s legal system. The taxation model includes:
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Net Income Recognition: Taxable income is based on net income (income minus expenses) or gross revenue.
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Income Timing: The timing of income recognition follows the general rule, which includes recognition upon receipt, compensation for goods or services, or at the time of asset disposal, such as exchanging virtual assets (VAs) for currency or non-digital assets.
According to the guidelines, only disposals of virtual assets in exchange for currency or non-virtual assets are considered taxable events.
International Comparisons: Crypto-to-Crypto Tax Exemptions
The document also highlights countries with favorable tax regimes for cryptocurrency transactions. Nations like Austria, France, Singapore, Malaysia, and Georgia do not tax crypto-to-crypto transactions. For instance, Singapore does not impose capital gains tax on individuals or corporations, and Malaysia exempts crypto transactions unless they are frequent or regular. Georgia provides tax exemptions for individuals on both income and capital gains from crypto sales.
Specific Taxation for Mining, Staking, and Airdrops
The NSSMC document clarifies how specific operations in the crypto industry, such as mining, staking, hard forks, and airdrops, should be taxed. Key points include:
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VAT Exemptions: Token creation, free token supply, free storage, transfer of virtual assets, and certain token modifications are not subject to VAT.
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VAT-Applicable Transactions: Transactions like the supply of goods or services in exchange for cryptocurrency, rewards for storage and transfers, and modifications that create new tokens may be subject to VAT. These transactions may also qualify for VAT exemptions as specified under the EU VAT Directive.
Legislative Developments and Upcoming Bills
Magomedov shared that the taxation matrix was presented to Ukraine’s parliamentary finance, tax, and customs policy committee. A draft bill has already been prepared based on this matrix. Additionally, Kateryna Rozhkova, Deputy Governor of the National Bank of Ukraine, revealed in an interview that a bill on virtual assets will be developed by October 2025, with international partners offering technical support. This bill will follow the guidelines set by the European MiCA (Markets in Crypto-Assets) directive.
This framework represents a significant step toward regulating the cryptocurrency sector in Ukraine, providing clearer rules for virtual asset taxation and fostering a more structured market environment.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a "detective-like" mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
