Mass Tax Audits Ahead for Individual Entrepreneurs: New Payment Deadlines and Penalties Announced

Tax Payment Deadlines for Individual Entrepreneurs

According to ХВИЛЯ: Lawyer Bohdan Yankiv has outlined the May tax deadlines for individual entrepreneurs (known as FOPs in Ukraine) and warned of a wave of desk audits scheduled from May through August. These checks will scrutinize filings for discrepancies. Specifically, by May 11, third-group entrepreneurs must submit their declaration for January through March. By May 19, the same group must pay the single tax and military levy. For first- and second-group entrepreneurs, the payment deadline for these taxes falls on May 20.

The next mandatory deadline for the unified social contribution (USC) is set for July 20. Failure to pay USC results in a fine of 20% of the owed amount, plus a penalty of 0.1% for each day of delay. Yankiv also highlighted common errors found in tax declarations, including:

• cash register revenues exceeding the amount declared;
• income reported in counterparty 4DF forms surpassing the declared amount;
• non-fiscalized receipts through payment services;
• underreported employee salaries;
• technical mistakes in filling out declarations.

Mass Desk Audits

From May to August, the tax authority will conduct extensive desk audits. According to tax order No. 524 dated June 2, 2015, a shared IP address among multiple entrepreneurs or legal entities is considered a risk indicator. As Yankiv noted,

“You might have failed to pay UAH 5,707 and 2 kopiyky for the third quarter. If you didn’t pay, the fine is UAH 1,141 and 40 kopiyky.”

Additionally, the lawyer emphasized that

“VAT is a matter of time,”

suggesting that the actual implementation of this tax for entrepreneurs is not expected until 2028–2029. Therefore, business owners must stay vigilant about payment deadlines and potential audits in the coming months.

In summary, Yankiv’s warning about tax deadlines and the audit period is crucial for individual entrepreneurs, as timely compliance with tax obligations helps avoid fines and other financial penalties. Entrepreneurs should pay attention to potential risks from declaration errors and prepare for audits to ensure business stability amid a changing tax environment.

As the tax authority intensifies its scrutiny of individual entrepreneurs, it's also focusing on broader financial activities, such as taxation of P2P transfers. This shift, backed by upcoming court rulings in 2025, underscores the importance of compliance across all financial transactions. Entrepreneurs must remain informed about their obligations to avoid penalties and ensure smooth operations.