The State Tax Service released an official interpretation letter (No. 3421/ІП/99-99-12-02-01-15) on 30 October 2026 addressing the Unified Social Contribution (ЄСВ) base for non-monetary gifts provided to employees on anniversaries, professional holidays, and corporate events. The letter resolves long-standing disputes by confirming that the tax base for ЄСВ (22% employer rate) is the fair market value of the gift at the moment of transfer, determined by reference to comparable market prices (paragraph 164.2.17 of the Tax Code). Crucially, it clarifies that the UAH 1,000 per employee per year exemption under subparagraph 164.2.17 applies only to goods classified as “social aid” (соціальна допомога) under the employer’s internal collective agreement, not to all gifts. Gift cards and vouchers are treated as cash equivalents, fully taxable. The guidance applies retroactively to open tax periods (statute of limitations: 3 years).
Key Takeaways
- Exemption Narrowly Defined: The UAH 1,000 annual exemption covers only items explicitly listed in the collective agreement as “social assistance” (e.g., food packages, fuel vouchers for heating). Branded merchandise, electronics, alcohol, and luxury items are fully taxable regardless of value.
- Valuation Methodology: For unique items (custom jewelry, art), employers must obtain an independent appraisal report dated within 30 days of the gift date. For standard goods, a screenshot from three major retailers’ websites showing current prices suffices as evidence.
- Personal Income Tax (ПДФО) Alignment: The same valuation applies for ПДФО (18% + 1.5% military tax) withholding. However, the employee’s annual non-taxable minimum (UAH 1,000 for gifts from employer under Art. 165.1.38) operates independently of the ЄСВ exemption, creating potential double-taxation if not coordinated.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement