Does a Sole Proprietor Have to Pay the Single Social Contribution While Caring for a Child if the State Already Pays It for Them

The issue of social justice in the taxation of self-employed individuals in Ukraine remains a subject of ongoing discussions, especially regarding the obligation of sole proprietors to pay the single social contribution for themselves even during periods when entrepreneurial activity is not actually carried out due to caring for a newborn child.

After the entry into force of the Law of Ukraine dated 05.11.2025 No. 4681-IX, approaches to supporting parenthood and social protection have undergone significant changes. The State Tax Service of Ukraine provided individual tax consultation No. 2881/ІPK, which clarifies the procedure for applying the rules regarding the payment of the UST by sole proprietors during maternity leave.

The STS analyzed the situation when a sole proprietor under the simplified taxation system (third group) has been on childcare leave until the child is three years old since February 2024 and receives the corresponding state assistance. The child will reach three years of age at the end of 2026.

The taxpayer does not have a primary workplace, but the minimum single social contribution is paid monthly on their behalf by the state through the Pension Fund of Ukraine due to childcare.

The key question was whether the sole proprietor has an obligation to pay the UST for themselves additionally — that is, effectively making a double contribution payment after the legislative changes that came into force on 01.01.2026.

In its explanation, the State Tax Service of Ukraine analyzes the provisions of Law No. 2464 on the single social contribution in connection with laws on state support for families with children.

The key provision is part six of Article 4 of Law No. 2464 "On the collection and accounting of the single contribution for compulsory state social insurance," according to which sole proprietors are exempt from paying the UST for themselves for those months when the minimum insurance contribution has already been paid on their behalf by an employer.

According to paragraphs seven and twelve of clause 1 of part one of Article 4 of Law No. 2464, payers of the single contribution are employers, namely enterprises, institutions, organizations, individuals who employ hired labor, military units. This also includes bodies that pay monetary allowances, temporary disability benefits, maternity benefits, assistance, supplements, or compensation according to the legislation for persons caring for a child until the child reaches three years of age and who receive childcare assistance according to the law.

The tax authority explains that bodies that pay childcare assistance, in certain cases, perform the function of the person ensuring the payment of insurance contributions.

Thus, if the state through the Pension Fund already pays the minimum UST on behalf of the sole proprietor during the childcare period, there is no additional obligation for the sole proprietor to pay the contribution as an entrepreneur — provided the criteria defined by law are met.

For persons who were assigned and registered for childcare assistance until 01.01.2026 and continue to receive it after this date, the previous order of payments and mechanisms for paying the single contribution by the respective payers remain in effect.

At the same time, the STS clarifies: if for the respective months less than the minimum insurance contribution was paid or the contribution was not paid at all, the sole proprietor is obliged to independently determine the UST calculation base and pay it in a general manner.

The sole proprietor can continue their activity, receive income, and at the same time not pay the UST for themselves, since the law links the benefit to the fact of contribution payment by another state entity, not to the fact of suspension of entrepreneurial activity.

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