Diia City Benefits for Startups: How to Keep 5% PIT and Minimum SSC Without 9 Employees

The Diia City tax regime, introduced by Law No. 1667-IX, has become one of the most important reforms for the IT sector in Ukraine. This regime combines favorable tax conditions, tools for attracting investments, and flexible forms of cooperation with specialists. However, the complexity of transitional provisions often raises questions among business entities, especially startups that are just beginning their journey. Individual tax consultation dated 11.06.2026 No. 3358 was a response to a company's inquiry facing the problem of how to combine startup status, a small number of employees, and the risk of exceeding the income limit without losing the right to preferential tax rates.

According to the Law of Ukraine "On Stimulating the Development of the Digital Economy in Ukraine" No. 1667-IX, the general requirements for a Diia City resident are to pay an average monthly remuneration to employees and gig specialists of at least 1200 euros, as well as to have an average number of employees and gig specialists of at least nine persons.

At the same time, for startups — legal entities registered no earlier than 24 months before acquiring the status of a Diia City resident — the law provides an exception to these requirements at the initial stage of activity.

The company that requested the individual tax consultation acquired Diia City resident status in March 2026. At the time of the request, it had only three employees, which for a startup does not contradict the legislative requirements. The startup exercised the right not to apply the general requirements regarding the number of employees and the amount of average remuneration. From April 2026, the company began to comply with the remuneration requirement, but the number of employees remained 3 persons.

In June, a situation arose where the startup's total income exceeded the limit of 1167 minimum wages, due to which the company formally lost the startup criteria and should have met the general criteria of a Diia City resident. The taxpayer asked: does the right to preferential PIT rates of 5% and SSC at the minimum contribution amount remain in the month of exceeding the limit?

Taxation of specialists' income (PIT and Military Tax)

As a general rule, the income of specialists of a Diia City resident, such as salary, remuneration under gig contracts, is taxed at a rate of 5% PIT.

If the tax agent ceases to meet criteria such as the number of employees or the amount of remuneration, it is usually obliged to independently calculate PIT at the rate of 18% at its own expense.

Benefit for startups

Paragraph 170.141.6 of the Tax Code establishes a simplification for startups: until December 31 of the year following the year of acquiring resident status, the requirement of 9 employees is not mandatory for applying the 5% PIT.

Calculation of the Single Social Contribution (SSC)

The basic SSC rate for employers is 22%. However, for Diia City residents, a preferential rate is set — at the amount of the minimum insurance contribution (the product of the minimum wage and 22%).

The State Tax Service indicates that a resident startup has the right to a preferential period until the end of the next year. According to subparagraph 170.14-1.6 of the Tax Code of Ukraine and part 14-1 of article 8 of the Law on SSC, if a company acquired resident status as a startup, the rules regarding tax consequences of non-compliance with the employee number criterion do not apply until December 31 of the calendar year following the year of acquisition of the status.

Since the company acquired Diia City resident status in March 2026, it has the full right until 31.12.2027 to apply the PIT rate of 5% and military tax of 5% on specialists' income and SSC at the amount of the minimum insurance contribution.

If after the transitional period the Diia City resident continues not to meet the general requirements, in particular regarding the number of employees of 9 persons, the company will be obliged to independently recalculate, accrue at the rate of 18%, and pay at its own expense the tax on specialists' income paid for the last 3 months of the previous calendar year.

In addition, the company will be obliged within one month to independently additionally calculate and pay SSC at the rate of 22% of the actual calculation base instead of the minimum contribution for the last 3 months of the previous calendar year.

Thus, the startup status provides a deferral: the ability to work with a team of fewer than 9 people and pay minimal taxes of 5% PIT, 5% military tax, and minimum SSC contribution for almost two calendar years — the year of acquiring the status and the following year.

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