Exemption of Defense City residents from land tax and real estate tax

The Main Department of the State Tax Service of Ukraine in Poltava region reports that residents of Defense City are granted exemptions from:

land tax;

real estate tax (excluding land plots).

This exemption takes effect from the month following the month in which resident status is obtained and remains in force until the end of the month in which such status is terminated. The relevant amendments were introduced by Law of Ukraine No. 4577, which entered into force on October 5, 2025. These provisions apply until January 1, 2036, but not longer than the year Ukraine acquires EU membership.

The exemption applies to:

Land tax:·     

• land plots on which industrial facilities are located and used in the business activities of Defense City residents;
• and plots temporarily not used in business activities during the relocation period, provided they are not transferred for use to third parties.

Real estate tax:     

• real estate objects located in the locality chosen for relocation, provided they are not leased, rented, or otherwise granted for use (except to employees of the Defense City resident) and are used in business activities and/or for accommodation of employees;
• industrial buildings classified under “Industrial and warehouse buildings” (code 125) of the State Classification of Buildings and Structures (NK 018:2023), which during the relocation period are not used for their intended purpose and are not leased, rented, or otherwise granted for use.

For Defense City residents, penalty accrual rules do not apply when calculating and paying land tax and real estate tax.

If resident status is lost:

The right to tax benefits is terminated;

By the 20th day of the following month, it is necessary to:

• submit amended tax returns;
• pay tax liabilities along with penalties;

Penalties are calculated from the first reporting period after the loss of status, without limitation periods.