TAXATION
OF SEAFARERS’ INCOME IN UKRAINE
INTERNATIONAL CREWING CONFERENCE
Speaker – Artyom Volkov
Senior Lawyer, Attorney-at-law
Head of Maritime Law Practice
ANK Law Office
PAYERS OF INCOME TAX
UNDER UA LAW
 Individuals – residents, who urn income from Ukraine
and foreign countries as sources of funds;
 Individuals – non-residents, who urn income
from Ukraine as source of funds;
 Tax agents
(e.g. employer).
TAX RESIDENCE
FOR INDIVIDUALS
 Place of living in Ukraine OR
 Permanent residence in Ukraine for 183 days OR
 Citizenship of Ukraine
INCOME TAX RATES
GENERAL RATE – 15%
up to USD 1 430 (as of 01.01.2013) income per month
SPECIAL RATE – 17%
if monthly income exceeds USD 1 430 (as of 01.01.2013)
amount in excess shall be taxed under 17%
INCOME DECLARATION
Term of Declaration Filing – till May 1
Declaration can be filed earlier
FOREIGN INCOME
Foreign income shall be declared and taxed in Ukraine
except foreign income that should not be taxed
due to the provisions of Tax Code and
Double Taxation Avoidance Agreements
Double Taxation Avoidance Agreement
UKRAINE CONCLUDED
Double Taxation Avoidance Agreements with 49 countries
among which are:
•
United Kingdom
•
Belgium
•
Italy
•
Netherlands
•
USA
•
Portugal and others
•
Germany
•
Turkey
•
China
Paying of the Foreign Income Tax in other country
should be proved by the relevant reference
issued by Tax Authorities
TAXATION OF OTHER PAYMENTS IN
SEAFARERS FAVOR
 Loss of Life Compensation
 Disability Compensation
 Sick Pay
Control of Seafarers’ Tax Paying
Crewing Agencies as
Seafarers’ Tax Agents (?)
Crewing Agencies cannot be a Tax Agent
Because they are not Employers
PENSIONS FOR SEAFARERS
Many Employers (mostly from EU)
pays seafarers’ fees to the social (pension)
funds of country of incorporation
International Agreements
on Mutual Pension Provision
Mostly concluded with former USSR countries
(e.g. Russia, Belarus, Georgia, Moldova) and
Eastern Europe countries
(e.g. Latvia, Lithuania,
Poland, Czech Republic,
Slovakia)
SOLUTION APPROACH
Solidary System of Retirement Insurance
MAIN STAGES:
I – Application filing
II – Concluding of Agreement
III – Paying of Insurance Fees
Funded System of Retirement Insurance
May be realized by one of the following forms:
1.
2.
3.
4.
Individual Saving Fund in Pension Fund of Ukraine;
Individual Saving Fund in non-government pension fund;
Insurance Agreement of Life Pension;
Pension deposit in bank
THANK YOU
FOR YOUR ATTENTION