Individual entrepreneurs of the third group will be able to return to the single tax rate of 5% excluding VAT in 2027

Individuals – entrepreneurs of the third group, who will terminate contractual relations at the end of 2026, will be able to return to paying a single tax at a rate of 5% excluding VAT in 2027. According to Finposter, entrepreneurs will not have to go through additional waiting procedures.

What will change for entrepreneurs

As the publication notes, individual entrepreneurs of the third group, who will terminate contractual relations in December 2026, will have the opportunity to return to a single tax rate of 5% without registering as a VAT payer next year.

The material states that entrepreneurs will not need to wait an additional period to return to the appropriate taxation regime.

This may be relevant for entrepreneurs who change the format of cooperation with customers or temporarily cease their activities.

Will the closure of an individual entrepreneur affect the possibility of returning to the simplified system

According to Finposter, termination of entrepreneurial activity with subsequent re-registration should not deprive individual entrepreneurs of the third group of the opportunity to apply a rate of 5% excluding VAT.

At the same time, entrepreneurs need to take into account the requirements of the Tax Code of Ukraine regarding staying on the simplified taxation system, deadlines for submitting applications and restrictions for re-transition to the single tax.

Important: the termination of a contract in itself does not mean an automatic transition to a different tax rate. The procedure for its application depends on the entrepreneur’s tax status and fulfillment of the conditions established by law.

What to check before changing the tax regime

Before terminating activities or re-registering, entrepreneurs should clarify:

whether they meet the requirements for applying the third group of the single tax;
whether there are no tax restrictions for switching to the simplified system;
what deadlines for submitting applications will apply in a specific situation;
whether it is necessary to cancel the registration of the VAT payer.

The Finposter publication does not provide the number of the regulatory act or official clarification of the State Tax Service, which would confirm the possibility of returning to the 5% rate without additional formalities in all cases.

Therefore, before making a decision to close or re-register an individual entrepreneur, it is advisable for entrepreneurs to obtain individual tax advice.