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Tax discounts in Ukraine

The legislation of Ukraine provides for the possibility to return a certain amount to an officially employed person, from the amount of money spent in the following industries: construction and repair, education, medicine, insurance, real estate purchase. Few people know, but the people of these returns are called tax credits.

Tax discounts in Ukraine and their registration

Tax rebates, getting a specific amount back that was paid to the state. This process is a kind of compensation for money that was spent as a result of different items of expenditure. The main applicants are officially employed persons. After all, the amount of the tax discount directly depends on the amount of annual taxes paid.

For example, people who are engaged in business activities, as well as employees who work under a contract-do not count on such deductions. For such funds, you will need to prepare certain documents, the list of which directly depends on the specific expenditure item and scope.

In what areas can you get tax discounts in Ukraine?

Training

This deduction is considered one of the most popular. It is possible for students who study in public institutions on a contract basis, if they pay for the education of their children (daughter/son) or spouse.

According to the Tax Code of Ukraine, the right to a tax discount is also granted in pre-school, school and out-of-school institutions.

To obtain the status of a potential applicant for receiving payments, it is recommended to prepare a package of documents in advance:

  1. Original and copy of passports (birth certificate), taxpayers (parents or spouses) and student (child, student or spouses).
  2. In the accounting department, the taxpayer must obtain a certificate of their salary for the past year.
  3. TIN in the original and a copy.
  4. A copy of the signed contract for the student’s education, according to which the regular payment is made.
  5. Originals of all receipts that confirm payment for training, every quarter or every month (depending on the payment terms specified in the contract).
  6. Completed tax return.

To get tax discounts, you must submit the collected set of documents to the office of the fiscal service at the address of your place of residence.

Real estate

If the taxpayer has an official place of work, he can buy real estate and expect a refund of 1% of the amount paid to the Pension Fund. However, you will need to take into account only one thing – this person must be registered at the address where the purchased apartment or house is located. If we are talking about a house that is still undergoing construction and repair work, then the citizen must submit a declaration for the benefit of the cumulative total for the past years, when he paid the mortgage interest (if the house was in the mortgage). You can only use the benefits again after 10 years.

It is also possible to get a certain discount on the second loan. But this will be relevant if the first loan was fully repaid.

Under the tax discount on the loan, it is customary to consider compensation from the interest paid, which is accrued for the use of Bank funds. The amount varies from the square of the purchased apartment / house. The maximum allowed parameters are 100 sq.m. Anything greater than the specified number will be calculated with a lower coefficient.

To return the mortgage tax, you must prepare a certificate from the workplace about the monthly salary and income tax that was withheld throughout the year. The rest of the list of documents does not differ from the case of receiving tuition payments.

Treatment

The Tax Code of Ukraine States that a taxpayer can receive compensation for their treatment or their relatives who belong to the first degree of kinship. Under such payments it is accepted to consider:

  • Use of rehabilitation services.
  • Purchase of medicines and other medical devices for the disabled. Purchase of prosthetic and orthopedic products and more.

→ Exceptions to the list:

  • Treatment of alcohol dependence.
  • Cosmetic surgery services.
  • Gender
  • Treatment of all sexually transmitted diseases. AIDS and other infectious diseases that can be obtained by household means are exceptions to the rule.

At the moment, such deductions are not considered relevant in the medical field. However, some situations that confirm the payment of compensation for reproductive services.

To get a discount on the use of such technologies, you will need documents that confirm all monetary expenses in this industry. Moreover, this list of documents must be submitted by the person who signed a contract with a specific medical institution for further cooperation.

Insurance

Every Ukrainian who regularly pays taxes can get compensation for payments that were spent to pay for insurance. Besides, according to the law, you can return money for issued life insurance.

The Declaration can only be submitted once a year. It is not necessary to insure your  life, you can get insurance for your wife/husband, children.

Tax credits: the formula for calculating the refund

The calculation of the tax discount directly depends on the specific expenditure item, so you need to pay attention to each of the presented industries.

Education

Receiving money is defined as follows: total monthly tuition fee, number of training months. The amount received is used during the determination of the income tax of 18%.

Let’s consider the process as an example: if one month of training costs 2,000 UAH, and only in the school year 10 months (2 months are allocated for summer holidays), then the formula turns out the following amount 2,000*10 and 18% of the amount. It turns out-3,600 UAH.

Medicine

The calculation of deductions for the use of reproductive technologies is as follows: for example, the monthly salary is 10,000 UAH, for the entire year, this amount increases to 120,000 UAH. The allowed discount is 30%. Thus, there is an amount of 40,000 UAH, of which 18% is 7,200 UAH.

Real estate

A person who wants to get money for a property that has been issued a loan must receive a salary that corresponds to the monthly payments for this loan.

When the taxpayer has a minimum wage of 3,200 UAH, and credit interest – 4,000 UAH, it is impossible to expect a refund of more than 3,200 UAH.

Insurance

Ensuring a comfortable old age forces pensioners to activate an additional account. At the same time, it is worth remembering that the signed contract will be valid for at least 10 years. Therefore, during this time, the person must officially work and receive a monthly salary from which deductions are made.

The person who issued this service must pay a certain amount of money every month. The refund amount is fixed and is 403.92 UAH. That is 18% of 2,240 UAH. Even if the amount is 5,000 UAH, the citizen still receives 403.92 UAH.

If the insurance is issued for one member of the family, 50% is activated for a reduction coefficient, the payment of 18% reaches 201.06 UAH.

This service is still not available for people who are engaged in business activities (private entrepreneurs), non-working pensioners and people who have an unofficial income that is not recorded in the tax service in any way.

If you want to get tax discounts in Ukraine in a particular area, consult with Kasyanenko & Partners Law Company.

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