Solutions from Ukraine: new E-Residency project allows foreigners to conduct remote business in Ukraine
Photo: Freepik
Ukraine will soon launch a new E-Residency program that will enable foreign entrepreneurs to open accounts and manage their businesses online easily.
The Minister of Digital Transformation, Mykhailo Fedorov, announced that.
What is the problem?
Foreigners who wanted to do business in Ukraine used to have to navigate a complicated bureaucratic process, which naturally required a significant amount of time and money.
What is the solution?
However, on April 1, 2023, the idea of e-residency in Ukraine became a reality. This required changes to the tax laws developed over two years. Now, residents of Ukraine can obtain the same status as those in Estonia or Lithuania.
How does it work?
Draft Law No. 5270, adopted in October 2022, will allow foreign citizens to obtain a special status and work in Ukraine online.
"In a few days, we will launch electronic residency, like in Estonia, but with better conditions. We are entering another level of competition with countries; we will present it in the IT arena," the minister announced.
In the initial phase, project participants will have the option to register as individual entrepreneurs. Subsequently, they plan to introduce the registration of companies as LLCs.
Fedorov noted that E-Residency will become an independent business ecosystem. The project will be presented at the IT Arena, which will be held from September 27 to 29 in Lviv.
The official also noted that the state is working on a pilot project of static Internet and the development of 5G in Ukraine.
It should be added that the Ministry of Statistics adjusted the list of countries whose entrepreneurs will become the first e-residents in Ukraine: Slovenia, India, Pakistan, and Thailand, and planned to launch an e-residency in the first quarter of 2024.
During operation, the "e-resident" will pay a 5% tax on income within the limit of the third group of individual entrepreneurs and above the limit—15%, but only on external contracts for the export of services.
For reference:
Rubryka has gathered answers to potential questions that may arise once you've become aware of the options for e-residency: registration, taxes, and allowable types of business operations. As the concept is still evolving, there are still numerous inquiries. However, a general understanding of what e-residency entails can already be established. For more information, check out Rubryka's article: "Electronic residency for foreigners in Ukraine: everything you need to know."
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