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HomePublicationsRepresentative experienceWhy is it worth investing in starting a business in Ukraine?

Why is it worth investing in starting a business in Ukraine?

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Despite the difficult political situation, Ukraine has always been a profitable place for foreign investment. It will continue to be so after the war is over. A large number of highly qualified and inexpensive labor force, favorable tax rates for many types of activities - this is what attracts investors from all over the world.

It is possible to open your own business in Ukraine in different forms. Until recently one of the most popular forms was a foreign representative office. Today, due to changes in legislation, the registration of a Ukrainian company, where the participant is a foreign legal entity or entrepreneur, comes to the fore.

Today we will talk in general about the registration of foreign business in Ukraine and the rules of investing in such a business.

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Which company would be considered an enterprise with foreign investment? 

If the foreign part of the capital is at least 10%, such a company is considered a company with foreign investment. This part of the company's capital will be considered an investment, and the foreign person who contributed this part of the capital - a foreign investor.

Important! Today in Ukraine sanctions and restrictions are imposed on companies in which 10% or more of the capital was contributed by Russian participants. 

Why is it interesting to make a contribution to a company in the form of an investment?

For example, because in certain cases this can give certain benefits. For example, in the form of a contribution you don't give money, but, say, property - equipment. At the same time you import it from abroad. Such property will be exempt from paying customs duty. 

How to register a company with foreign investment?

Stick to the following algorithm:

  • Prepare a package of documents from the foreign founder, fill out a registration form and prepare a package of constituent documents for the registration of a Ukrainian company;

  • Submit the documents to Ukrainian registrar;

  • Form the share capital of the company - for this there are 6 months after registration of the company. To do this you will have to come to Ukraine and personally attend the opening of an account in a Ukrainian bank;

  • Submit your documents to the tax and statistical authorities for accounting. This is done automatically during registration, but you need to check that everything has been recorded correctly.

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Where can difficulties arise?

Formation of the statutory fund.

As we have already said above, the formation of the fund can even be property - for example, equipment that is necessary for the operation of the enterprise. If the fund or its part is formed in cash, it is necessary to open an account in a Ukrainian bank. You can form a statutory fund not only in money but also in property. 

It is possible to invest money in the form of investments in a certain foreign currency (euro or dollar). 

Obtaining VAT for Ukrainian enterprise.

Working in Ukraine you may need to obtain the status of VAT payer. It is not possible to receive VAT immediately upon registration, you will have to fill out a separate application, and its processing will have to wait for at least a week.

The choice of taxation scheme for the company depends on the planned sources of funding, the expected number of employees and their wages. Our lawyers will help to choose the best system and provide recommendations on how to optimize business taxation in Ukraine.

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