Employee training at the employer's expense: in which cases personal income tax does not arise
Employers have the right to organize professional training for their employees taking into account the needs of the enterprise or other activities. This possibility is provided by the Law of Ukraine "On Professional Development of Employees".
Training can be conducted directly at the enterprise or on a contractual basis in vocational and higher education institutions, as well as in other institutions or organizations. The law allows employers to organize both formal and informal professional training, the Tax Service reminds.
Formal professional training for workers covers initial professional preparation, retraining, and advanced training. For managers, professionals, and specialists, it includes retraining, internships, specialization, and advanced training. After completing such training, the employee receives an education document of the established form.
Informal professional training involves acquiring new knowledge and practical skills without being tied to a specific place, time frame, or form of training. It is carried out with the employee's consent directly at the employer and is financed at the employer's expense.
The Tax Code establishes that funds paid by the employer or another person on behalf of Ukrainian higher or vocational education institutions for the training, preparation, or retraining of an employee are not included in the taxable income of the individual. In 2026, this benefit applies within the limit of 25,941 UAH for each full or partial month of training (three minimum wages as of January 1, 2026).
In addition, employer expenses for advanced training or retraining of an employee are not subject to taxation if they are carried out in accordance with legal requirements.
However, if the employer violates the established conditions or the cost of training exceeds the limit set by the Tax Code, the excess amount is considered an additional benefit to the employee. In this case, it is included in the employee's taxable income and is subject to personal income tax at a rate of 18%.
Separate rules apply to employees' participation in seminars and conferences. If under the contract the customer of information and consulting services is the employer, and the employee only represents their interests, the paid participation is not considered the employee's income and is not subject to personal income tax.
However, if the contract stipulates that the recipient of the services is the employee themselves, the funds paid by the employer for their participation in the seminar or conference are recognized as an additional benefit. Such amounts are included in the individual's taxable income and taxed at a rate of 18%.
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