On 1 January 2020, Resolution No. 565 of the Cabinet of Ministers of Ukraine dated 22 April 2019 came into force, approving the ‘Procedure for providing additional financial support to family farms through a top-up payment mechanism for the benefit of insured persons — members/heads of family farms — of the single contribution for compulsory state social insurance”.

Members/heads of family farms without legal entity status and registered as single tax payers in Group 4 are entitled to receive the top-up. 

Payers who have not fulfilled the conditions set out in paragraph 131.3 of Article 131 of the Law of Ukraine ‘On State Support for Agriculture in Ukraine’ lose their entitlement to the top-up payment.

In accordance with paragraph 4 of Part 1 of Article 4 of Law No. 2464-VI, payers of the single contribution for compulsory state social insurance (hereinafter – the single contribution) are individual entrepreneurs, including those who have opted for the simplified taxation system.

Individual entrepreneurs, including those who have opted for the simplified taxation system, shall pay the single contribution calculated for the calendar quarter by the 20th day of the month following the quarter for which the single contribution is payable (third paragraph of Part 8 of Article 9 of Law No. 2464). That is, the deadline for payment of the single contribution for such payers is the 19th day of the month following the quarter for which the single contribution is payable.

In accordance with paragraph 6 of Section IV of the Instructions on the procedure for calculating and paying the single contribution for compulsory state social insurance, approved by Order of the Ministry of Finance of Ukraine No. 449 of 20 April 2015 (hereinafter – Instructions No. 449) if the last day of the deadline for payment of the single contribution falls on a weekend, public holiday or non-working day, the last day of such deadlines for payment of the single contribution shall be deemed to be the first working day following the weekend, public holiday or non-working day.

At the same time, it should be noted that the right to receive the supplementary payment is lost in the following cases:

1. Upon leaving a family farming enterprise (the right to a supplementary payment is retained by the members/head of the family farming enterprise who remain within it);

2. Upon transition from the fourth group of single tax payers to another group of single tax payers, withdrawal from the simplified system of taxation, accounting and reporting, cancellation of registration as a single tax payer, or state registration of the termination of the family farm’s business activities;

3. Upon being classified as persons specified in the second subparagraph of paragraph 2 of the Procedure, approved by Resolution of the Cabinet of Ministers of Ukraine No. 565 of 22 April 2019:

3.1. Are subject to insurance on other grounds (work elsewhere and are insured persons);

3.2. Are exempt from paying the Unified Social Tax (pensioners, disabled persons);

3.3. Do not participate voluntarily in the compulsory state social insurance system (in accordance with Law No. 2120-IX of 15 March 2022).

Source: Main Directorate of the State Tax Service in Lviv Region