In brief
An Israeli who is not a Ukrainian tax resident and sells property there generally pays 18% income tax plus a 5% military levy on the sale price, before the notary certifies the contract. According to the position of the Ukrainian tax authority, the first sale in a year of a home held for more than three years, or received by inheritance, is exempt for a non-resident as well. A non-resident may let property only through a local tax agent, and an annual real estate tax and land tax set by local authorities also apply. In Israel you are taxed on the same income and receive a credit for the Ukrainian tax, within limits.
Key takeaways
- 1Sale by a non-resident: 18% income tax and a 5% military levy, on the contract price and not on the gain (as of October 2026).
- 2The first sale in a calendar year of a flat or house held for more than three years, or received by inheritance, is tax-exempt, and according to the Ukrainian tax authority's position this also applies to a non-resident. Commercial property does not qualify for the exemption.
- 3The tax is paid before the notary certifies the contract. The buyer additionally pays 1% to the Pension Fund, unless entitled to an exemption.
- 4A non-resident may let property in Ukraine only through a sole proprietor (ФОП) or a Ukrainian company acting as tax agent and withholding the tax at source.
- 5In Israel: a sale is reported within 30 days and is subject to capital gains tax of up to 25% on the real gain, less a credit for the Ukrainian tax. For rent you may choose the 15% track without a credit, or marginal-rate tax with a credit.
Which taxes apply to an Israeli who owns property in Ukraine?
Four main taxes: income tax and the military levy on a sale and on rent, an annual real estate tax on buildings, and land tax. On the buyer's side there is also a 1% Pension Fund levy. Ukraine has no separate inheritance or gift tax, but an inheritance or gift is treated as income of the recipient and is subject to income tax. At the same time, as Israeli residents you are liable to tax in Israel on your worldwide income, so every item of income from the property in Ukraine enters two tax systems.
| Tax | Rate (as of October 2026) | Who pays | When |
|---|---|---|---|
| Income tax on a sale (ПДФО) | 18% for a non-resident, if no exemption applies | The seller | Before the notary certifies the contract |
| Military levy on a sale | 5%, only where income tax applies | The seller | Together with the income tax |
| Pension Fund levy | 1% of the contract price | The buyer | Before the contract is certified |
| State duty on a real estate sale | 1% according to PwC | As agreed between the parties | At signing |
| Income tax and military levy on rent | Generally 18% and 5% | The tax agent withholds from the rent | When the rent is paid |
| Annual real estate tax on buildings | Up to 1.5% of the minimum wage per sq m above the relief (up to UAH 129.71 per sq m in 2026) | The owner | Within 60 days of receiving the assessment |
| Land tax | Based on the normative valuation of the land and the local authority's decision | The owner or user of the land | Annually |
| Income tax on an inheritance or gift where one party is a non-resident | 18%, plus the military levy | The heir or recipient of the gift | As part of the inheritance or gift procedure |
Sources: PwC Worldwide Tax Summaries for Ukraine (reviewed June 2026) and Ukrainian professional sources. The military levy was raised from 1.5% to 5% by Law 4015-IX, which entered into force on 1 December 2024. According to PwC, the rate for individuals will return to 1.5% from 1 January of the year following the end of martial law.
How much tax does a non-resident pay on selling a flat in Ukraine?
If no exemption applies, a non-resident pays 18% income tax plus a 5% military levy, i.e. 23%, on the sale income. Under Article 172.9 of the Ukrainian Tax Code, as cited by professional sources, a non-resident's income from selling real estate is taxed under the rules that apply to residents, but at 18% instead of 5%. A point that surprises Israeli investors: the base is the contract price, and not less than the estimated value of the property, rather than the gain. The purchase cost is not deducted.
The exemption for the first sale in a year. Income from one sale in a calendar year of a residential house, flat or part of them, a room, a garden house, or a land plot within the statutory norm is tax-exempt if the seller has owned the property for more than three years. The three-year condition does not apply to inherited property. According to a professional article from November 2025, relying on the position of the Ukrainian tax authority, this exemption also applies to non-residents. Where the exemption applies, the military levy does not apply either, because the levy applies only to income that is subject to income tax.
| Situation | Non-resident (Israeli) | Ukrainian resident, for comparison |
|---|---|---|
| First sale in a year of a flat or house, owned for more than three years or received by inheritance | Exempt, according to the tax authority's position | Exempt |
| Flat or house owned for three years or less (not inherited) | 18% plus 5% military levy | 5% plus 5% military levy |
| Second and subsequent sale in the same year | 18% plus 5% military levy | 5% plus 5% military levy |
| Commercial property, such as an office or shop | 18% plus 5% military levy | 5% plus 5% military levy |
An illustration: an Israeli sells a flat in Kyiv for a contract price of UAH 3,000,000, a year and a half after buying it. The exemption does not apply, so he will pay UAH 540,000 income tax (18%) plus UAH 150,000 military levy (5%), a total of UAH 690,000, even if his real gain is much smaller. Had he held the flat for more than three years, and not sold another property in the same year, the sale would have been exempt.
According to PwC, the tax authorities may dispute the application of certain exemptions to non-residents, so it is advisable to obtain confirmation from a notary or a Ukrainian tax adviser before pricing the deal on the basis of an exemption. Even when the sale is exempt in Ukraine, it is taxable in Israel.
When is the tax paid, and what is the notary's role?
The seller calculates the tax and pays it through a bank before the notary certifies the sale contract. This is provided by Article 172.5 of the Tax Code, according to PwC and professional sources. In practice, the notary will not certify the contract without proof of payment of the tax and the levy, or a basis for the exemption. Since every transaction before a notary requires a Ukrainian tax identification number, the Israeli seller also needs an РНОКПП, which can be obtained through an attorney-in-fact.
When you act from Israel, the power of attorney to your representative in Ukraine should expressly cover paying the taxes and levies on your behalf. The power of attorney is signed in Israel, certified with an apostille and translated into Ukrainian. It is also important to keep all payment receipts, because these are the documents you will present to the Israel Tax Authority to obtain a credit.
Who pays the 1% Pension Fund levy?
The buyer. According to PwC (June 2026), whoever acquires real estate in Ukraine, an individual or a company, pays a 1% levy to the State Pension Fund. According to reports in the professional press from August 2026, the levy is still in force in 2026, is calculated on the price in the contract and is paid before notarial certification. There are certain exemptions, for example for some first-time home buyers. If you are the seller, the levy is not imposed on you, but it is part of the buyer's cost and therefore affects the negotiation. In addition, according to PwC a 1% state duty applies to real estate sales, and it is advisable to set out in the contract how it is split between the parties.
How is an Israeli's rental income in Ukraine taxed?
A non-resident may let property in Ukraine only through a Ukrainian sole proprietor (ФОП) or a company resident in Ukraine, acting on his behalf under a written agreement and serving as his tax agent. This is provided by Article 170.1.3 of the Tax Code, and PwC confirms the rule in its June 2026 summary. The tax agent withholds the tax from the rent and remits it to the budget. A non-resident who lets directly, without such an agent, is considered to be evading tax.
- The general rate: 18% income tax and a 5% military levy, withheld at source by the tax agent.
- Tenant that is a company or sole proprietor: the tenant itself is the tax agent, withholds the tax and remits it.
- A new change, Law 4903-IX: the law, adopted on 9 June 2026, provides that where the tenant is an individual, income from letting residential or non-residential property is taxed at 5% instead of 18%, and that the landlord files an annual return instead of paying quarterly. According to a professional publication, the change applies from 23 October 2026, and the military levy on ordinary rent remains 5%.
- Does the new rate apply to non-residents? The law did not change a non-resident's obligation to let through a tax agent. It is therefore not yet clear whether an Israeli can benefit from the 5% rate. It is advisable to check this with a Ukrainian tax adviser before signing a new lease.
According to PwC, the area relief from the annual real estate tax does not apply to property used to generate income. In other words, a let flat may be subject to real estate tax on its entire area, and not only on the part exceeding the exempt area.
How much real estate tax and land tax are paid in Ukraine each year?
The annual real estate tax on buildings is based on the area of the property, and its rate is set by the local authority, up to a cap of 1.5% of the minimum wage per sq m. According to PwC, the cap in 2026 is UAH 129.71 per sq m. Each owner has an area relief: 60 sq m for a flat, 120 sq m for a house, and 180 sq m where the owner has property of both types. Local authorities may add further reliefs.
- Large properties: the relief does not apply to a property whose area is five or more times the relief area. For a flat above 300 sq m or a house above 500 sq m, UAH 25,000 per year is added for each such property.
- Example: an 80 sq m flat, in a city that has set the maximum rate, is taxed on 20 sq m only, i.e. about UAH 2,594 per year. If the flat is let and the relief does not apply, the tax will be calculated on the full 80 sq m.
- Payment: the tax authority calculates the tax for individuals and sends an assessment, which must be paid within 60 days of receipt. When you live in Israel, make sure that someone receives the mail in Ukraine, so that an assessment does not get lost and accumulate penalties.
- Combat areas: according to PwC, no real estate tax is imposed on property in areas where hostilities took place or that were occupied, or on destroyed property. Damaged property may qualify for an exemption under certain conditions.
Land tax is an annual local tax whose rate depends on the designation of the land, its location and its normative valuation, and it is imposed on the owners or users of the land. Owners of a private house with a plot should check it too. According to PwC, no land tax is imposed on plots in combat or occupied areas, but from 1 January 2026 the exemption for plots whose buildings were destroyed was terminated. Note that foreigners may not own agricultural land.
What about inheritance and gifts?
Where the deceased or the heir is not a Ukrainian resident, the inheritance is taxed at 18% income tax, regardless of the family relationship, and the military levy applies in addition. According to PwC, the reduced 0% rate for close family members applies only to Ukrainian residents. The same rules apply to gifts. We cover this in more detail, including deadlines and registration, in our guide on inheriting property in Ukraine for Israeli heirs.
What does the Israel-Ukraine tax treaty provide?
Israel and Ukraine have a double taxation treaty in force, and PwC includes it in the treaty lists of both countries. As in most tax treaties, the state where the property is located, Ukraine, may tax the income from letting it and the gain from selling it. Israel, as the state of residence, taxes the same income and grants a credit for the tax paid in Ukraine. The practical meaning: the treaty does not reduce Ukrainian tax on real estate, but prevents double payment in Israel.
To obtain the credit in Israel you must prove the tax paid in Ukraine: receipts for the payment made before the notary, or a certificate from the tax agent for the tax withheld from the rent. For other types of income from Ukraine, the paying party may request a certificate of residence from the Israel Tax Authority in order to apply the treaty.
How do you report rent and the sale of a property in Ukraine in Israel?
An Israeli resident with rental income from abroad must file an annual return and may choose between two taxation tracks.
| 15% track (section 122A) | Regular track (marginal rate) | |
|---|---|---|
| Tax base | Gross rent, with no deduction of expenses | Net rent, after expenses and depreciation |
| Credit for the Ukrainian tax | No | Yes, up to the Israeli tax on the same income |
| Tax rate | 15% | According to the personal tax brackets |
| When it suits | When the foreign tax is low or nil | When significant tax was withheld in Ukraine |
In Ukraine, a non-resident's rent is generally taxed at 18% plus a 5% military levy. In that situation, the 15% track without a credit will lead to double taxation, and the regular track with a credit will usually be more suitable. Check with your accountant whether the military levy is recognised as a foreign tax for credit purposes.
A sale of property abroad by an Israeli resident is not governed by the Real Estate Taxation Law but by the Income Tax Ordinance, as capital gains tax. The real gain, after inflation adjustment, is taxed at up to 25%, and the sale must be reported within 30 days of the date of sale. The tax paid in Ukraine is credited against the Israeli tax, up to the Israeli tax on the same gain, and excess foreign tax is not refunded. Because Ukraine taxes the sale price rather than the gain, the Ukrainian tax may exceed the Israeli tax, and then the excess is simply lost. Conversely, when the sale is exempt in Ukraine, the entire tax will be paid in Israel. High earners should also check the surtax.
Checklist before a sale or a lease
- Check the current travel warning of the Israeli Ministry of Foreign Affairs, and plan to act through a power of attorney, without travelling to Ukraine.
- Make sure you have an РНОКПП, and prepare a power of attorney with an apostille and translation that also authorises payment of taxes.
- Collect the title documents and check the date on which the right was registered, to know whether three years have passed.
- Check whether you sold another property in Ukraine in the same calendar year, and whether the property is classified as residential or commercial.
- Obtain from a notary or a Ukrainian tax adviser a written calculation of the tax, the military levy and the estimated value.
- For a lease: sign a written agreement with a sole proprietor or company that will act as tax agent, and obtain annual certificates from them of the tax withheld.
- Check that there are no real estate tax or land tax arrears, and that someone receives the assessments in Ukraine.
- Check in advance whether the funds can be transferred to Israel, separately from the tax question.
- In Israel: report a sale within 30 days, and choose a taxation track for the rent each year together with your accountant.
What to do before selling or letting a property in Ukraine, and how we accompany you
Tax in Ukraine is determined before signing and paid before the notary certifies the contract, so the calculation is done in advance and not on the day of the transaction. Acts under Ukrainian law are performed by licensed local notaries and lawyers. We coordinate them from Israel, review the documents and the tax calculation, prepare the power of attorney, and look at the transaction from the perspective of an Israeli investor: what will happen in the Israeli reporting, and how the tax paid in Ukraine will be recognised as a credit. We do not recommend investing in Ukraine and do not assess the security situation. Our role is to present the legal and tax position to you as it is.
The information here is general information, as of October 2026, and is not legal or tax advice for a specific case. Ukrainian tax legislation changes frequently during martial law, including the military levy rate and the rules on taxing rent, so the rates should be verified with a Ukrainian notary or tax adviser close to the date of the transaction.
Frequently asked questions
How much tax does an Israeli pay on selling a flat in Ukraine?
If no exemption applies, 18% income tax plus a 5% military levy on the contract price, and not less than the estimated value (as of October 2026). The first sale in a year of a flat held for more than three years, or received by inheritance, is exempt according to the Ukrainian tax authority's position, also for a non-resident.
Is the tax in Ukraine calculated on the gain or on the sale price?
On the sale price in the contract, and not less than the estimated value of the property. The purchase cost is not deducted. Therefore even a sale at a small gain or at a loss may trigger significant tax if the exemption does not apply.
Can an Israeli let a flat in Ukraine directly to a tenant?
Under Article 170.1.3 of the Tax Code, a non-resident may let only through a Ukrainian sole proprietor or a Ukrainian company acting as his tax agent under a written agreement. Letting directly is treated as tax evasion.
Is there a tax treaty between Israel and Ukraine?
Yes, there is a treaty in force. Ukraine may tax rent from and the sale of property located in its territory, and Israel grants a credit for the tax paid there, up to the Israeli tax on the same income.
Should I choose the 15% track for rent from Ukraine?
Usually not, where tax of 18% plus the military levy was withheld in Ukraine, because the 15% track gives no credit for foreign tax and the result is double taxation. The regular track, with deduction of expenses and a credit, is more suitable in most cases. The choice is made each year with your accountant.
Read next · 10 min readSelling Property in Ukraine under Martial Law and Moving the Proceeds to Israel: What Is Possible, What Is Restricted and the RisksSelling an apartment in Ukraine under martial law: the register, occupied areas, a power of attorney from Israel and NBU limits on moving the proceeds abroad.Read the guideSources
- PwC Worldwide Tax Summaries - Ukraine, Individual: Income determination (sale of real estate)
- PwC Worldwide Tax Summaries - Ukraine, Individual: Other taxes (real estate tax, inheritance and gifts)
- PwC Worldwide Tax Summaries - Ukraine, Individual: Significant developments (military levy, Law 4015-IX)
- PwC Worldwide Tax Summaries - Ukraine, Corporate: Other taxes (land tax, pension fund charge, stamp duty)
- Buhplatforma - Sale of real estate by a non-resident: which PIT rate applies (14 November 2025)
- Debet-Kredit - 5% PIT on individuals' rental income instead of 18%: Law No. 4903 (October 2026)
- Dray & Dray - Taxation of foreign real estate for Israelis (November 2025)