Diia City is a special legal and tax regime for the IT industry in Ukraine, creating favorable conditions for the development of tech companies. One of the primary target audiences of Diia City is sole proprietors (SP) who are actively working in the field of information technology. In this article, we will discuss the benefits and opportunities that Diia City provides for SPs and how this regime can impact their activities.
SPs operating under Diia City gain access to a simplified tax regime, which includes:
- Single Tax on Personal Income: The tax burden is reduced to 5%, which is significantly lower compared to the general taxation system.
- No Profit Tax: Instead of the standard profit tax, companies can pay a capital withdrawal tax at a rate of 9%, which encourages reinvestment into business development.
Diia City provides a high level of intellectual property protection, which is critical for IT professionals and software developers. This includes:
- The ability to register patents and copyrights.
- Protection against unauthorized use of intellectual property by third parties.
The Diia City regime offers various forms of collaboration between companies and SPs, including:
- Contracts with Gig Specialists: This new format of labor relations allows the engagement of highly qualified specialists on flexible terms.
- Collaboration via Civil Law Contracts: These contracts enable working on projects without the restrictions of traditional labor contracts.
Diia City aids Ukrainian IT companies in entering the international market by:
- Providing consulting and legal support on service export issues.
- Creating a network of partnership programs with international organizations.
1. Expanding the Client Base
SPs within Diia City have access to a platform that connects IT service providers and clients, allowing them to find new clients both in Ukraine and abroad.
2. Training and Skill Enhancement
Diia City organizes various training programs, seminars, and webinars that help IT professionals enhance their skills and stay updated with the latest technologies and trends.
3. Financial Support
Diia City offers various financial support programs for startups and young companies, including grants, loans on favorable terms, and venture financing.
4. Community and Networking
Diia City fosters a strong community of IT professionals and entrepreneurs, promoting the exchange of experiences, knowledge, and ideas, which can be a crucial factor for successful business development.
Diia City provides significant advantages and opportunities for SPs in the IT field. The simplified tax regime, intellectual property protection, flexible forms of collaboration, and support for international expansion make this regime attractive for entrepreneurs. Leveraging the opportunities offered by Diia City can promote the successful growth and competitiveness of Ukrainian IT companies in the global market.
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Serhii Floreskul
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Violetta Loseva
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