A developing market of opportunity
One of the leading European IT hubs, Ukraine is a developing market that offers a large range of business opportunities. The country provides special tax benefits for IT professionals; it also has its own digital economy law ‘Diia City’, aimed at enhancing the Ukrainian IT business sector.
Alongside this, the country boasts one of the cheapest capital cities in Europe with Kyiv. It also possesses a great geographical location / time zone and low labor costs. The market is moving towards a western-focus, and it holds significant potential for businesses looking to engage in it. Many companies make use of a Professional Employer Organization or Employer of Record, to gain quick easy access to the Ukraine market.
When it comes to working hours, the general rule in Ukraine is that the total working time per week can not be more than 40 hours per week / 8 hours a day. Employees are generally granted at least two holidays per week. Part time schedules can also be established – for example, 2 hours per day.
Working in Ukraine
Holiday / sickness allowance
Generally, it is accepted that all employees shall have at least 24 calendar days of paid annual vacation. Special categories of employees are granted to extended vacations. Such categories are:
- Disabled individuals
- Single parents with a child under 14 years old
- Employees who work in dangerous / harmful conditions
As well as this, there are other types of vacations that could be granted such as:
- Vacations for pregnancy and childbirth
- Vacation for childcare under the age of 3 years old
- Vacation for education
All employees are also granted state holidays such as New Year, Christmas, Easter, Independence Day, Constitution Day and more.
Employees are also granted sickness allowances. To receive it, the employee must provide a medical certificate issued by the authorized authority. The employer pays for the first 5 days of sick leave; the Fund of Social Insurance pays for subsequent days.
Taxes
Taxes paid by the employee:
- Income Tax – 18%
- Military tax – 1.5%
Taxes paid by the Employer:
- Unified Social Tax – 22% (currently the maximum amount of UST is 19 800 UAH)
Visas
To employ foreign workers in Ukraine, a work permit is essential. Disabled employees should also provide certification of disability.
Cultural information
The state language of Ukraine is Ukrainian, however Russian is also commonly used. Most documents are executed in the Ukrainian language, but they may also be bilingual.
The main religion of Ukraine is Orthodox Christianity. Other religions are not forbidden.
Ukraine COVID Impacts
Remote working practices were adopted in Ukraine as a result of the COVID-19 pandemic. Hybrid working practices have also become common, with many employees working both from home and in the office.
Establishing remote working practices with an employer does not require changes to an employment agreement; they can be arranged based on the order of the employer.
The Ukrainian Market – Other information
- Salaries should be paid two times per month
- Advance payments should not be paid later than the 22nd day of the current month
- The main salary should not be paid later than the 7th day of the next month
- Minimum salary is 6,000 UAH per month
- Salary should be paid in UAH
- Companies should comply with a quota of disabled employees that make up 4% of the total number of employees
- The disabled employee quota is not applicable if a company has under 8 employees
- For companies with 8 to 25 employees, at least one disabled employee is a requirement
Ukraine PEO Services
Ukraine PEO Services
One of the leading European IT hubs, Ukraine is a developing market that offers a large range of business opportunities. The country provides special tax benefits for IT professionals; it also has its own digital economy law ‘Diia City’, aimed at enhancing the Ukrainian IT business sector.
Alongside this, the country boasts one of the cheapest capital cities in Europe with Kyiv. It also possesses a great geographical location / time zone and low labor costs. The market is moving towards a western-focus, and it holds significant potential for businesses looking to engage in it. Many companies make use of a Professional Employer Organization or Employer of Record, to gain quick easy access to the Ukraine market.
When it comes to working hours, the general rule in Ukraine is that the total working time per week can not be more than 40 hours per week / 8 hours a day. Employees are generally granted at least two holidays per week. Part time schedules can also be established – for example, 2 hours per day.
Working in Ukraine
Holiday / sickness allowance
Generally, it is accepted that all employees shall have at least 24 calendar days of paid annual vacation. Special categories of employees are granted to extended vacations. Such categories are
- Disabled individuals
- Single parents with a child under 14 years old
- Employees who work in dangerous / harmful conditions
As well as this, there are other types of vacations that could be granted such as:
- Vacations for pregnancy and childbirth
- Vacation for childcare under the age of 3 years old
- Vacation for education
All employees are also granted state holidays such as New Year, Christmas, Easter, Independence Day, Constitution Day and more.
Employees are also granted sickness allowances. To receive it, the employee must provide a medical certificate issues by the authorized authority. The employer pays for the first 5 days of sick leave; the Fund of Social Insurance pays for subsequent days.
Taxes
Taxes paid by the employee:
- Income Tax – 18%
- Military tax – 1.5%
Taxes paid by the Employer:
- Unified Social Tax – 22% (currently the maximum amount of UST is 19 800 UAH)
Visas
To employ foreign workers in Ukraine, a work permit is essentials. Disabled employees should also provide certification of disability.
Cultural information
The state language of Ukraine is Ukrainian, however Russian is also commonly used. Most documents are executed in the Ukrainian language, but they may also be bilingual.
The main religion of Ukraine is Orthodox Christianity. Other religions are not forbidden.
Ukraine COVID Impacts
Remote working practices were adopted in Ukraine as a result of the COVID-19 pandemic. Hybrid working practices have also become common, with many employees working both from home and in the office.
Establishing remote working practices with an employer does not require changes to an employment agreement; they can be arranged based on the order of the employer.
The Ukrainian Market - Other information
- Salaries should be paid two times per month
- Advance payments should not be paid later than the 22nd day of the current month
- The main salary should not be paid later than the 7th day of the next month
- Minimum salary is 6,000 UAH per month
- Salary should be paid in UAH
- Companies should comply with a quota of disabled employees that make up 4% of the total number of employees
- The disabled employee quota is not applicable if a company has under 8 employees
- For companies with 8 to 25 employees, at least one disabled employee is a requirement
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