Tax transparency and DAC7: Digital platforms and new requirements for individuals (Part 1)

As part of Ukraine’s European integration efforts and in line with its international commitments, the revised draft law on the implementation of an international initiative on the automatic exchange of information on income derived through digital platforms was presented by the Ministry of Finance in March 2025 and approved by the Cabinet of Ministers on 29 April 2025. As of today, the document has already been registered with the Verkhovna Rada of Ukraine as draft Law No. 13232 dated 30 April 2025 and submitted to the relevant committee for review. The document was developed on the basis of the EU DAC7 Directive, the OECD Model Reporting Rules, and the Multilateral DPI MCAA (Multilateral Competent Authority Agreement on Automatic Exchange of Information on Income Derived Through Digital Platforms).

The draft law is aimed at establishing transparent rules for reporting on income earned by individuals and legal entities through online platforms, as well as at introducing a mechanism for the international exchange of tax information.

The DAC7 Directive was adopted on 22 March 2021 as part of the EU’s efforts to improve tax transparency in the digital economy. Under the new standards, digital platforms and individuals conducting business through such platforms will face new tax obligations.

Who will be affected by the changes?

Primarily, the updated legislation covers two main categories:

• Individuals and organizations (“reportable sellers”) that provide services or sell goods through digital platforms, including offering accommodation, transport and personal services, selling goods, or renting means of transportation. If such individuals are paid consideration for their activities through platforms, they fall under the scope of the new rules.
• Platform operators (“reportable operators”) that provide access to digital infrastructure for relevant activities. These can be both Ukrainian and foreign platforms that work with Ukrainian residents or with property located in Ukraine. Such operators will be required to register, file reports, pay taxes, and act as tax agents.

What is meant by "platform"?

The new draft law defines “platform” or “digital platform” as any software (including websites, mobile applications, or a combination thereof) that allows sellers to offer goods or services to other users for consideration. Platforms may facilitate access to a wide range of activities – from transportation and delivery to real estate rental, freelance services, and e-commerce.

The definition refers to both Ukrainian and foreign services if they allow individuals (residents of Ukraine) to receive income that should be reported to the state tax services.

Who qualifies for special taxation rules for income derived through digital platforms?

Individuals may be eligible for special taxation of income earned through digital platforms if they simultaneously:

• are tax residents of Ukraine,
• have reached the age of 18,
• are not registered as individual entrepreneurs or self-employed persons,
• make payments exclusively in cash,
• do not have hired workers,
• use a special bank account,
• do not sell excisable goods,
• receive, during the calendar year, income from relevant activities in the amount not exceeding the amount of 834 minimum wages established by law as of 1 January of the tax (reporting) year.

Tax burden: what rates will apply?

Income earned by individuals through digital platforms will be taxed as follows:

• The 5% rate will apply to the total amount of income received from relevant activities if it does not exceed 834 minimum wages established as of 1 January of the tax (reporting) year (in 2025: UAH 6,672,000)/
• The 18% rate will apply to the amount of excess over the abovementioned income threshold, while additionally obliging individuals to file PIT returns.

Taxes on income earned through digital platforms will automatically be withheld by platform operators, who will act as tax agents. Banks, in turn, will be required to disclose information about the accounts of reportable persons at the request of tax authorities.

Obligations of reportable sellers and digital platform operators

Under the new model for administering taxes through digital platforms, both individuals (reportable sellers) and platform operators will have separate, but interrelated, obligations.

1. Individuals (reportable sellers) will be obliged to:

• Open a special account with an authorized bank
• Permit the bank to write off the amount of the tax liability
• Ensure there is a sufficient balance in the special account for timely tax payment
• Accept online payments only through digital platforms and offline payments through cash registers (desktop or software-based)
• If an individual sells goods through the platform no more than three times during the reporting year for a total amount not exceeding the equivalent of EUR2,000, they are allowed to use their regular bank accounts instead of opening a dedicated current account of a reportable seller. However, they must provide the platform operator with the account details.

2. Digital platform operators will be obliged to:

• Register in Ukraine as a reportable platform operator, regardless of their residency status (foreign platforms working with Ukrainian sellers or assets may also be subject to this requirement)
• Establish and verify the status of reportable sellers through the due diligence procedures: the platform operator is obliged to collect and verify information about reportable sellers, including identification and banking data
• Provide the State Tax Service with annual reports including data on amounts of income paid, number of transactions, types of activities, and other required information
• Act as a tax agent: in cases provided for by the law, the platform calculates and transfers tax to the budget
• Provide data to the regulatory authorities upon request and participate in automatic exchange mechanisms pursuant to the DPI MCAA
• Retain records for at least 5 years from the reporting date or termination of cooperation with the seller

International information exchange mechanism

• The draft law provides that, following the DPI MCAA’s requirement, Ukraine joins the international automatic tax information exchange system, developed based on the OECD Model Rules, meaning that Ukraine will participate in automatic exchange of data on income derived through digital platforms with tax authorities of the participating countries on an annual basis.

  Within this framework, digital platform operators (both residents and non-residents operating in Ukraine) must collect and verify information about reputable sellers, and then provide it to state tax services, including data on their income, type of services or goods, number of transactions and bank details. This information may then be shared with tax authorities in other countries as part of a multilateral exchange.

  Participation in the DPI MCAA significantly improves tax transparency at the international level, while reducing opportunities for tax evasion and the concealment of income abroad through the use of foreign platforms.

_{We continue to monitor changes and the practice of introducing novelties. Our team engaged in taxation of individuals will continue to share useful information with you.}

_{Comments provided by Deloitte experts herein are for information purpose only and should not be used by taxpayers without an in-depth expert analysis on a case-by-case basis.}

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