Thresholds of criminal liability for intentional tax evasion in Ukraine
Tax discipline is one of the key elements of state budget stability. However, in practice, tax evasion remains a common offense among business entities. To prevent such actions, the Criminal Code of Ukraine (CCU) establishes specific thresholds of criminal liabilityi.e., the limits of the amount of unpaid amounts after which evasion is recognized as a crime.
🔹 Regulatory framework
The main rules governing liability for evasion of taxes, duties and other mandatory payments are Article 212 of the Criminal Code of Ukraine. It determines when a financial violation becomes a criminal offense.
🔹 What is considered tax evasion
Evasion is defined as intentional actions or omissions of the taxpayeraimed at reducing or avoiding tax liabilities.
It could be:
-
concealment of income or objects of taxation;
-
double counting;
-
submission of deliberately false reports;
-
the use of fictitious companies or VAT fraud.
🔹 Thresholds of criminal liability in 2025
Liability depends on the amount of unpaid taxes compared to tax-free minimum income (NMIT), which is currently conditionally equivalent to 17 UAH.
| Level of violation | The size of the evasion | Qualifications | Sanction. |
|---|---|---|---|
| Significant size | Over 4 000 NMDG (≈ 68 000 UAH) | Part 1 of Article 212 of the Criminal Code | A fine of UAH 51,000-85,000 or deprivation of the right to hold certain positions for up to 3 years |
| Large size | Over 7,000 NMDG (≈ UAH 119,000) | Part 2 of Article 212 of the Criminal Code | A fine of UAH 85,000-136,000 or imprisonment for up to 5 years |
| Extra large size | Over 17,000 NMDG (≈ UAH 289,000) | Part 3 of Article 212 of the Criminal Code | Imprisonment for up to 10 years with confiscation of property |
⚖️ Important: the legislation is constantly being updated, so when determining the thresholds, you should be guided by the current official explanations of the tax authorities and court practice.
🔹 Conditions of criminal liability
For the actions of a taxpayer to be qualified under Article 212 of the CCU, the following elements must be proven:
-
Intent - that is, a conscious desire to avoid paying taxes.
-
Actions or omissions - submission of false declarations, fictitious transactions, etc.
-
Consequences - real shortfall in budget revenues within the established limits.
If the payer independently eliminated the violation (paid taxes and fines before the notification of suspicion was served), he is exempt from criminal liability under Part 4 of Article 212 of the Criminal Code.
🔹 Court practice
Courts often proceed from the principle of proportionality: not every tax violation automatically becomes a criminal offense. If the violation is related to errors in accounting or controversial interpretations of regulationsand not with intent, the criminal proceedings may be closed.
🔹 How to avoid the risk of criminal liability
-
✅ Conduct regular tax audits - internal or with the involvement of consultants.
-
📑 Maintain transparent accounting and keep all documents confirming business transactions.
-
⚙️ Check counterparties through open registries (YouControl, Opendatabot).
-
🧾 Correct errors in reporting in a timely manner - voluntary clarification of declarations reduces the risk of prosecution.
🔹 Conclusion
Criminal liability for tax evasion means not only financial penalties, but also reputational losses for businesses.
The thresholds defined by the law allow to distinguish between gross misconduct from common tax mistakesHowever, each case requires a thorough legal analysis.
🧩 Recommendation: in case of tax disputes or the risk of criminal prosecution, it is advisable to seek legal assistance from a tax lawyer - timely advice can prevent serious consequences for your business.