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Publication date: 26.05.2024
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Main features of Diia.City
Diia.City is a Ukrainian initiative that creates digital and technological innovations to improve the quality of life and development of cities in Ukraine. It is an interactive platform that unites government services, business, public organizations and city residents to jointly solve various social, economic and environmental problems.
Diia.City is developed using modern technologies and concepts of "smart cities" (smart cities) aimed at improving infrastructure, mobility, energy efficiency and ensuring public safety.
The Diia.City initiative aims to create an innovative and open environment for urban development in Ukraine, where all stakeholders can collaborate to achieve common goals. This is an important initiative to increase competitiveness and ensure the sustainable development of Ukrainian cities in the conditions of global technological and economic transformations.
Diia.City is a special legal and tax regime in Ukraine, created for the development of the IT industry and the attraction of investments in this sector. Diia.City offers favorable conditions for the work of IT companies, including tax benefits, flexible labor relations and other benefits. The main goal is to create a competitive environment for Ukrainian IT companies on the global market.
The reduced income tax rate is 9% instead of the standard 18%. The rate of the single social contribution (SSC) is 22% of the minimum wage, which significantly reduces the tax burden on wages.Personal income tax (PIT) – 5% for salaries of employees of Diia.City residents.
Diia.City introduces a new type of contract - a gig contract, which combines the elements of an employment contract and a contract for the provision of services.
Gig contracts provide flexibility in personnel management and reduce the tax burden.
The Diia.City mode provides effective protection of intellectual property, which is important for IT companies involved in the development of software and innovative technologies.
Companies wishing to become residents of Diia.City must meet certain criteria, such as a minimum amount of revenue from IT activities, availability of qualified specialists and compliance with corporate governance standards. Residents of Diia.City must comply with the legislation of Ukraine, in particular in the field of labor, taxes and corporate law.
How to become a resident of Diia.City
To obtain Diia.City resident status, a company must apply through a special portal. The application is considered for compliance with the established criteria. It is important to provide all necessary documents and data. After successful verification, the company receives Diia.City resident status and can enjoy all the benefits of this regime.
Advantages for IT companies
1. Reduction of the tax burden: a simplified tax system allows companies to direct more funds to development and innovation.
2. Flexibility in labor relations: gig contracts provide more flexible conditions for hiring and cooperation with specialists.
3. Protection of intellectual property: reliable legal protection promotes the development of technological innovations.
4. Attractiveness for investors: transparent and favorable conditions create a positive image for investments in the Ukrainian IT sector.
Challenges and limitations
Companies must meet established requirements, which can be difficult for some businesses.
Residents of Diia.City must regularly confirm their compliance with the criteria, which requires additional effort and resources.
Conclusion
Diia.City creates unique opportunities for the development of the IT industry in Ukraine, providing favorable conditions for work and investment attraction. IT companies that meet the criteria and are ready to adapt to new conditions can gain significant benefits from participating in this special regime.
