Antwort Law reports the main news from the cryptocurrency market

An important step has been taken in Ukraine in the legalization of cryptocurrencies: the Verkhovna Rada approved in the first reading a draft law that defines the rules for the circulation and taxation of virtual assets.

Amendments to the Tax Code from January 1, 2026 provide for innovations in the taxation of individuals:

• a special regime for the taxation of transactions with virtual assets is introduced, separately from other income and investment income;
• a positive financial result from transactions with virtual assets at the end of the year is taxed, that is, sales proceeds are reduced by expenses incurred during the acquisition of assets;
• the list of permitted expenses is limited to minimize abuse, but may be expanded by the Ministry of Finance in agreement with the regulator;
• losses from previous periods are taken into account until fully paid off (with some exceptions, for example, if the authorization of assets has been canceled);
• there is no tax agent, the payer declares and pays taxes independently.

The following are not subject to tax:

• income from the exchange of one virtual asset for another;
• sale of assets for an amount up to the minimum wage;
• assets received free of charge or through an issue from an issuer or offeror, including assets received in exchange for personal data.

Transitional period: for virtual assets acquired before the new law comes into force, there is a right to choose a preferential rate of 5% personal income tax upon sale in 2026.

Regarding administration: providers of services related to the turnover of virtual assets must register with regulatory authorities and submit annual reports on operations. Fines are provided for failure to fulfill these obligations, and during the transitional period they are applied at a reduced rate - 10% in 2026 and 25% in 2027-2029.

Corporate income tax and VAT have also received clear rules: transactions for the issuance, exchange and sale of virtual assets, except for NFTs and assets certifying the right to demand the transfer of property or the provision of a service, are not subject to VAT. Service providers cannot operate on a simplified taxation system, and single tax payers are not entitled to carry out transactions with virtual assets.

Definition of virtual assets: this is unique digital content that can be transferred and stored using distributed ledger technology or similar technology and which may contain a digital representation of intellectual property objects or references to them.

If the law has caught you by surprise or you have questions about the taxation of virtual assets, book a consultation with Antwort Law. We will be happy to help you understand and protect your interests!

Olena Deilid

Junior Legal Secretary