For many Ukrainians, renting out real estate has become not just a way to earn money, but the only source of income in wartime conditions. However, as soon as an apartment starts generating profit, it legally becomes a business object requiring strict compliance with tax legislation.
A property owner trying to avoid responsibility often attempts to shift the tax burden onto the tenant by simply adding the tax amount to the rent. However, according to Tatyana Danilenko, head of the Civil Law and Procedure Committee of the Association of Lawyers of Ukraine, this does not exempt the owner from liability.
Who pays and when: legal nuances
From a legal standpoint, the obligation to declare income lies exclusively with the owner (landlord). The existence of a lease agreement automatically confirms the fact of receiving income from real estate. Even if the property is rented out as part of entrepreneurial activity (Sole Proprietorship/FOP), income from renting apartments or houses is taxed as ordinary income of a physical person.
If you rent out property as an individual, you are obliged to declare the income and pay taxes yourself. The key factor here is timing. Payment must be made within 40 days after the end of each quarter. The Tax Code of Ukraine sets clear deadlines for the quarterly reporting period:
- by February 9;
- by May 9;
- by August 9;
- by November 9.
In addition to quarterly payments, the property owner must submit an annual declaration of property status and income, indicating the total amount of rent received for the year.
Fines and criminal liability
The tax service actively monitors income from real estate, and serious sanctions are provided for violations. In case of systematic tax evasion, fine amounts can range from 51,000 to 85,000 hryvnias for concealing income.
The law provides not only administrative but also criminal liability for non-payment of taxes in large amounts. This makes "shadow" renting extremely risky for owners.
Plans to reduce taxes and benefits
According to Tatyana Danilenko, many landlords are forced to work "in the shadows" due to economic difficulties caused by the war. Reducing the tax burden is being considered as a way to legalize the market.
Since June 9, the Verkhovna Rada has supported a bill to reduce the rent tax: the PIT (Personal Income Tax) for landlords will be reduced from 18% to 5%. The law is expected to come into force in 2027.
Also, a bill proposing new approaches to taxation has been registered in parliament. The document provides tax benefits for owners who rent housing to internally displaced persons (IDPs), war veterans, and persons with disabilities due to the war.
The rental market in wartime conditions
The situation in the rental market is uneven. There is the most interest in apartments in frontline cities: Zaporizhzhia, Kharkiv, and Sumy. At the same time, demand for rentals has "slumped" in Kyiv and Odesa.