How the Government Is Changing Financial Control Rules: What Ukrainians Need to Know

Over the past few months, the Ukrainian information field has been increasingly reporting on new governmental initiatives to strengthen financial control over citizens. This includes, in particular, the creation of the Register of Accounts and Individual Bank Safes for Individuals, as well as the introduction of mechanisms for identifying unofficial entrepreneurial activity on the Internet.

What awaits Ukrainians? To answer this question, we turned to experts from a specialized company in the field of corporate law and tax consulting, K.A.C. Group, for comments.

To start with, let us recall that in early April of this year, information appeared that even online sellers of goods in Ukraine began to be fined, and ordinary users of OLX, Prom.ua and social networks came under fiscal supervision. However, the State Tax Service denied the information about fines. The service emphasized that they do not fine for selling personal items on Internet platforms.

“The information spread by a number of media outlets that the tax authorities have allegedly begun fining sellers from OLX, Prom.ua, social networks and other platforms and automatically track all money transfers to individuals’ accounts, even if they sell personal items online, is not true,” the State Tax Service commented.

The State Tax Service emphasized that the sale of individual property, i.e., personal belongings of citizens, is not a basis for financial or administrative liability and does not violate the requirements of current tax legislation.

Only in cases where there is a systematic sale of the same type of goods, the situation may acquire signs of entrepreneurial activity. This does not apply to one-time or episodic sales of one’s personal things through electronic platforms such as OLX, Prom or social networks. The service also noted that control over online sales is being strengthened in order to prevent abuse and tax evasion in the field of economic activity.

A few weeks later, the Cabinet of Ministers of Ukraine approved a draft law designed to harmonize Ukrainian legislation with the European Union’s standards and the criteria of the European Payments Council. This is necessary for Ukraine to join the Single Euro Payments Area (SEPA).

One of the key aspects of the draft law is the creation of a centralized registry of bank accounts and individual safes of individuals. It will be administered by the State Tax Service (STS).

The Register will record the date of opening and closing of accounts, both bank and payment ones, including electronic wallets and securities accounts.

“The draft law stipulates that information on the movement and balances of funds on citizens’ accounts and on the contents of the safe is not transferred to the specified registry. Also, the provisions of the draft law do not provide for any restrictions or delays in conducting financial transactions by individuals in connection with the introduction of the Register,” the ministry assured.

Let us take a closer look at the legislative initiatives.

Does the tax service really automatically track all money transfers received to the accounts of individuals who sell goods through platforms such as OLX, Prom.ua, or even social networks?

Volodymyr Sytnik, lawyer at K.A.C. Group, explains that from March 1, 2025, changes to fiscal checks, approved by the order of the Ministry of Finance No. 601 dated November 22, 2024, came into force in Ukraine. From now on, checks must contain data about the recipient of funds, which allows the tax service to identify the seller.

Such changes apply to all operations carried out through settlement transaction registrars (STRs) and software PTRs, including online platforms OLX, Prom, Rozetka, and others. Payment systems, such as UAPAY, are required to generate fiscal checks and transfer them to the STR Data Accounting System.

This means that the tax service has access to sales information, which allows it to detect systematic entrepreneurial activity, even if it is carried out without official registration. For example, selling goods more than three times a year can be considered entrepreneurial activity.

If payment for goods or services is made via bank transfers without using an STR, the tax service can detect such cases by monitoring social networks such as Instagram or Facebook.

In addition, on April 30, 2025, draft law No. 13232 was registered in the parliament. It provides for amendments to the Tax Code of Ukraine regarding the automatic exchange of information on income received through digital platforms.

It concerns the introduction of automatic and simplified taxation of individuals who sell goods or provide services through marketplaces. If the law is adopted, such platforms will perform the functions of tax agents: they will collect and transmit information about users’ income to the tax authority.

The introduction of automatic exchange of information and taxation of income from digital platforms is another step towards de-shadowing online trade. Draft Law No. 13232 not only strengthens control by tax authorities, but also actually changes the rules of the game for thousands of Ukrainians who sell goods or provide services via the Internet.

If adopted, even temporary or additional activity on marketplaces will require official tax registration. Therefore, it is worth assessing your business activities online in advance and, if necessary, preparing for new rules.

What changes are taking place at the legislative level on the way to joining the Single Euro Payments Area (SEPA)? What do we know about new draft laws?

As Iryna Matsapura, a lawyer at K.A.C. Group, told us, in order to fulfill the conditions for joining the Single Euro Payments Area, the Ministry of Finance has developed two draft laws:

•“On Amendments to Certain Legislative Acts of Ukraine to Ensure Compliance with Acts of the European Union’s Law and the Relevant Criteria Established by the European Payments Council, with a View to Ukraine’s Joining the Single Euro Payments Area (SEPA)”;

•“On Amendments to the Code of Ukraine on Administrative Offenses and the Criminal Code of Ukraine to Ensure Compliance with Acts of the European Union’s Law and the Relevant Criteria Established by the European Payments Council, with a View to Ukraine’s Joining the Single Euro Payments Area (SEPA)”.

The following is provided for by these drafts:

1. Creation of the Register of Accounts and Individual Bank Safes of Individuals.

The administrator of the Register will be the National Bank of Ukraine. Accordingly, the Register itself will be non-public; however, the administrator will have the right, through special access or electronic information interaction between registers, to provide information received from banks that constitute banking secrecy to the State Financial Markets Service, Asset Recovery and Management Agency, Economic Security Bureau, National Agency on Corruption Prevention, state enforcement agencies and private enforcement agents.

Information that will be included in the Register:

1. Bank accounts, securities accounts, payment accounts, electronic wallets, etc.: date of opening (and/or closing), type and number of the account (including IBAN).

2. Full names of account, individual bank safe holders.

3. Institutions with which accounts are opened.

Information that will not be included in the Register:

• balances and cash flow;

• contents of the safe.

2. Creation of the Register of Ultimate Beneficial Owners of Trusts in Other Legal Entities.

The State Tax Service will also be the administrator of this Register.

3. Strengthening checks of ultimate beneficial owners and sanctions for entering inaccurate data.

For instance, Draft Law “On Amendments to Certain Legislative Acts of Ukraine to Ensure Compliance with Acts of the European Union’s Law and the Relevant Criteria Established by the European Payments Council, with a View to Ukraine’s Joining the Single Euro Payments Area (SEPA)” proposes to establish a fine for entering knowingly inaccurate information about the ultimate beneficial owner or submitting an inaccurate ownership structure in documents for state registration, in the amount of 38,000 non-taxable minimum incomes of citizens. This amounts to UAH 646,000.

K.A.C. Group expert emphasized that for failure to submit or untimely submission of information about the ultimate beneficial owner and/or ownership structure to the state registrar, it is proposed to establish a fine in the fixed amount of 10,000 non-taxable minimum incomes of citizens (UAH 170,000). According to current legislation, the fine is provided in the amount of 1,000 to 20,000 tax-free minimum incomes of citizens (UAH 17,000 – 340,000).

4. Sanctions for violations of financial monitoring rules will be harmonized with the EU’s requirements.

5. Creation of a system of whistleblowers of violations in the field of financial monitoring and providing them with protection.

The concept of “whistleblower” will be recognized in the Law “On Prevention and Counteraction to the Legalization (Laundering) of Proceeds of Crime, Financing of Terrorism and Financing of the Proliferation of Weapons of Mass Destruction”.

Iryna Matsapura explains that this new term means an individual who, having the belief that the information is reliable, informs or intends to inform an employee or manager responsible for conducting financial monitoring or the State Financial Monitoring Service about possible facts of violation of the requirements of the legislation in the field of prevention and counteraction, if this information has become known in connection with labor or other professional activities. This can include a fairly wide range of individuals, including interns, volunteers, individuals who have not yet started employment, individuals working under the direction of contractors or suppliers, etc.

Providing guarantees of protection involves making changes to a number of norms, in particular:

• Labor Code;

• Administrative Procedure Code;

• Civil Procedure Code;

• Law “On Free Legal Aid”.

In particular, providing guarantees of protection to employees who report possible violations in the field of prevention and counteraction to the legalization (laundering) of proceeds from crime, financing of terrorism and proliferation of weapons of mass destruction (from disciplinary liability or exemption from other measures of negative impact), granting such whistleblowers the right to free legal aid.

6. Trustees of trusts and traders of cultural values ​​will also report on suspicious transactions.

7. Persons previously held criminally liable will not be able to manage subjects of primary financial monitoring.

What has changed for citizens and what to expect

Volodymyr Sytnik, lawyer at K.A.C. Group, explains that the issue of personal income taxation in Ukraine is increasingly in the spotlight, especially against the backdrop of discussions on changes to legislation and Ukraine’s attempts to adapt its financial rules to European standards.

What innovations may affect ordinary citizens in the near future? We will consider this issue below.

Recently, the government has adopted a draft law ““On Amendments to Certain Legislative Acts of Ukraine to Ensure Compliance with Acts of the European Union’s Law and the Relevant Criteria Established by the European Payments Council, with a View to Ukraine’s Joining the Single Euro Payments Area (SEPA)”.

The main innovation is the simplification and reduction of the cost of money transfers. Thanks to SEPA, citizens and businesses will be able to transfer funds between European countries under uniform conditions. Commissions for such transactions will be significantly lower. According to estimates by the NGO “Institute for Economic Research and Policy Consulting”, the expected savings will be from EUR 70 to 100 million per year.

However, it should be noted that this Draft Law also provides for the creation of the Register of Accounts and Individual Bank Safes of Individuals. It will be administered by the State Tax Service. The Register will store information on the date of opening or closing a bank account, the type and number of the account, and data on the financial institution in which the account is opened.

The tax service will be able to transfer information constituting banking secrecy to the Asset Recovery and Management Agency, Economic Security Bureau, National Agency on Corruption Prevention, state and private executors.

At the same time, the Draft Law stipulates that information on the movement and balances of funds on citizens’ accounts will not be transferred to the specified Register. The provisions of the Draft Law do not provide for any restrictions or delays in conducting financial transactions by individuals in connection with the introduction of the register.

Thus, Ukraine’s accession to SEPA will contribute to significant savings for citizens and businesses due to a reduction in commission costs when making international transfers. However, these advantages are accompanied by changes in the field of financial transparency: access to banking information will become much easier for a number of state bodies. Although the movement of funds itself will remain outside the Register, the creation of a centralized database of accounts is another step towards strengthening state control.

Is it necessary to pay taxes even on card transfers?

The State Tax Service informs that under the Tax Code, income is considered any receipt of funds that increases a person’s financial capacity, regardless of whether it was one-time or regular. As explained by Danylo Hetmantsev, Head of the Verkhovna Rada Committee on Finance, Tax and Customs Policy, for a transfer received to a bank account, Ukrainians must pay 18% personal income tax (PIT) and 5% military levy – a total of 23%.

Still, not all transfers are subject to taxation.

“Money transfers to a card from relatives of the 1st and 2nd degree of kinship are not taxed, if it is a gift or inheritance,” explains Hetmantsev.

Moreover, not taxed are:

• repayment of loans or debts, provided there is documentary evidence;

• transfers that do not exceed 25% of the minimum wage (in 2025, this is approximately UAH 2,000).

In addition, Nina Yuzhanina, People’s Deputy of Ukraine, “European Solidarity” faction, previously reported that the situation with control over the circulation of funds might reach a new level. According to her, absolutely all income of citizens can be taxed in Ukraine (although there are currently no such initiatives).

In particular, the authorities may decide to increase taxes, in particular for individuals, and this is what the focus is currently on. Proposals are being discussed to tax any income: from transfers to a card to the sale of used items online.

“We need to keep in mind that, perhaps, the authorities will resort to a decision to raise taxes. I see how an environment is already being prepared around us that leads to an increase in taxes: “let’s tax the income of individuals – all of them”… That is, if you have transferred money to each other on a card, this is your income, so pay tax. If you sell a used item on a digital platform, you pay tax,” the Deputy noted.

At the same time, there is no talk of raising VAT at the moment, although this possibility is not excluded. In attempts to close the budget deficit, we cannot allow businesses to be forced out of the country, the Deputy noted.

“It all boils down to the fact that the authorities still believe individuals have more money. As for raising some state taxes at the level of income tax, indirect taxes, VAT, I have not heard of this yet, but anything is possible. The main thing here is that with this desire to find quick extra money, they do not throw business out of Ukraine. This is important. Since everyone is working on the edge, and if this fact is not considered, it may result very badly,” said Nina Yuzhanina.

She simultaneously added that 400 billion needs to be found somewhere. The same amount was recently mentioned by Yaroslav Zhelezniak, Deputy Chairman of the Parliamentary Committee on Finance, Tax and Customs Policy.

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