There is no one-size-fits-all answer. The right structure depends on the business model, revenue level, team size, cooperation with foreign clients, investment plans and long-term scaling strategy.

In this article, we explain the key differences between PE and LLC, their advantages and limitations, and the most common use cases for IT businesses in Ukraine in 2026.

What is PE?

PE stands for Private Entrepreneur. It is the simplest and most commonly used business structure for individual IT professionals in Ukraine.

PE is popular because it is easy to register, relatively simple to administer and usually has a lower tax burden compared to more complex corporate structures.

Main advantages of PE

• quick registration;
• simplified accounting;
• limited reporting requirements;
• straightforward access to funds;
• low administrative costs.

PE is commonly used by:

• software developers;
• QA engineers;
• designers;
• DevOps specialists;
• freelancers;
• independent consultants.

What is an LLC?

An LLC is a limited liability company. It is a separate legal entity that operates independently from its owners.

Compared to PE, an LLC is a more structured and administratively complex form of doing business. However, it also provides broader opportunities for growth, investment and long-term business development.

Main advantages of an LLC

• ability to attract investors;
• clear ownership and corporate structure;
• better suitability for scaling;
• ability to build and manage a team;
• higher level of trust from corporate and international partners.

An LLC is often used by:

• product IT companies;
• SaaS businesses;
• FinTech projects;
• startups;
• software development agencies.

Tax considerations

PE

Most IT professionals in Ukraine use the third group of the simplified tax system.

A typical tax structure includes:

• single tax;
• military levy;
• unified social contribution.

Taxes are generally paid on received income, regardless of actual business expenses.

PE is usually simpler to administer, but it may not be the best option for a business that plans to scale, attract investment or build a more formal corporate structure.

LLC

An LLC in Ukraine may operate under different tax models, including:

• the general corporate taxation system;
• the simplified taxation system, if the company meets the eligibility criteria;
• the Diia.City special legal and tax regime.

This is an important point: choosing an LLC does not automatically mean moving to the general taxation system. In some cases, an LLC may also operate under the simplified tax system, provided it complies with the applicable requirements and does not carry out restricted activities.

For IT businesses, an LLC on the simplified tax system may be a practical option for a small development team, IT agency or service company that has already outgrown the PE model but does not yet require a more complex corporate structure.

The overall tax burden will depend on the chosen tax regime, revenue model, expenses, dividend distribution, team structure and cooperation with local or international clients.

When is PE the right choice?

PE is usually a good option if:

• you work independently;
• you have one or several clients;
• you do not plan to attract investors;
• you are not building a large team;
• you want to keep administration and costs low;
• you provide services as an independent IT professional.

For many individual IT specialists, PE remains an efficient and cost-effective structure.

When should you consider an LLC?

An LLC becomes more relevant when the business starts to grow and requires a more formal structure.

Typical indicators include:

• you are building a team;
• you plan to attract investment;
• you are launching your own product;
• you are preparing for international expansion;
• you need to allocate ownership shares between co-founders;
• you want to sign contracts through a legal entity;
• you need a higher level of credibility with corporate or international clients.

In these cases, an LLC can provide a more stable and scalable structure for the business.

At the same time, an LLC does not necessarily have to operate only under the general taxation system. If the company meets the legal requirements, it may be able to use the simplified tax system.

PE or LLC for a startup

Startups often use a combined approach.

At the early stage, founders may work as PEs to launch quickly, test the idea and reduce initial administrative costs.

Once the business develops a product, attracts investors or starts generating more significant revenue, the founders often establish an LLC or consider an international corporate structure.

This approach allows the business to stay flexible at the beginning while preparing for future scaling.

What about Diia.City?

If the company operates in the technology sector and plans to grow a team, the Diia.City regime may also be worth considering.

Diia.City allows eligible companies to:

• choose between corporate income tax and tax on distributed profits;
• use gig contracts;
• operate under a special legal and tax framework;
• create a more transparent structure for investors;
• simplify cooperation with team members.

For many product IT companies, the combination of LLC + Diia.City may be the most effective model.

Conclusion

PE and LLC are not competing options. They are different tools for different stages of business development.

PE is usually suitable for independent specialists and small service-based teams.

LLC is a logical next step for companies that plan to scale, attract investment, build a team or develop their own product.

When choosing between PE and LLC, it is important to consider not only the tax burden, but also the long-term business goals, operational structure, client expectations and future growth plans.

Acturon consultation

Acturon helps IT businesses choose the right legal and tax structure, assess tax implications, prepare for the transition to an LLC or Diia.City, and organise accounting in line with Ukrainian legal requirements.

Planning to launch or scale an IT business in Ukraine? Contact us for a consultation.

Запис PE or LLC for an IT business in Ukraine in 2026: what to choose? спершу з'явиться на Acturon.

In this material, we will подробно review which taxes Diia.City residents pay, what tax models exist (9% or 18%), how salaries and gig contracts are taxed, and in which cases this regime is truly beneficial for IT companies.

Diia.City is a special legal regime for companies operating in the digital economy. It was created to make Ukraine a competitive jurisdiction for technology businesses and international IT companies.

Companies operating in the following areas can become Diia.City residents:

• software development
• SaaS products
• cybersecurity
• artificial intelligence and Big Data
• game development
• blockchain and fintech
• technology R&D

The main idea of the regime is that the state creates special conditions for technology companies: lower tax burden, a clear taxation model, and flexible forms of cooperation with teams.

Tax models for Diia.City residents

Diia.City residents can choose one of two tax models. The choice depends on the business structure, company development plans, and dividend policy.

1. Corporate Income Tax — 18%

This is the standard taxation model applied to most Ukrainian companies. The tax is paid on the financial result, i.e. the company’s profit. The formula is as follows:

Profit = Income – Expenses

The tax rate is 18%. This model is suitable for companies with significant operating expenses, those actively investing in product development, or those not planning to regularly distribute dividends.

2. Exit Capital Tax — 9%

An alternative model is the exit capital tax (ECT). In this case, the company does not pay income tax as long as the money remains in the business.

The tax is paid only when funds are withdrawn from the company, for example:

• dividend payments
• certain payments to non-residents
• non-repayable financial assistance
• certain transactions with related parties

The tax rate is 9%. This makes the regime particularly attractive for IT companies that actively reinvest profits into product development or business scaling.

Taxes on salaries and gig contracts

One of the key advantages of the Diia.City regime is a special model for taxing specialists’ income. Companies can cooperate with teams through employment contracts or gig contracts. The tax burden in these cases is the same:

Personal Income Tax — 5%

Military Tax — 1.5%

Unified Social Contribution — 22% of the minimum salary

An important feature is that the unified social contribution is calculated not from the actual income of the specialist, but only from the minimum salary. This significantly reduces the overall tax burden.

“Under the Diia.City regime, the total tax burden is approximately 7–8% of the specialist’s income, which is significantly lower than in the standard employment model.”

Criteria for Diia.City residents

To obtain Diia.City resident status, a company must meet certain requirements:

• average remuneration of specialists — not less than 1200 euros
• at least 9 specialists
• at least 90% of income from permitted IT activities

In addition, companies must submit a special Diia.City resident report and, in some cases, undergo an independent audit.

When the Diia.City regime is truly beneficial

Practice shows that the Diia.City regime is most effective for companies that:

• operate in IT or technology
• have a team of developers
• work with international clients
• plan to scale the business
• reinvest profits into product development

For such companies, Diia.City allows significant optimisation of the tax model and makes the business structure more transparent.

Conclusion

The Diia.City regime creates unique conditions for the development of technology businesses in Ukraine. The ability to choose between a corporate income tax of 18% and an exit capital tax of 9%, reduced taxation of specialists’ income, and flexible cooperation models make this regime one of the most attractive for IT companies.

However, to effectively use all the advantages, it is important to correctly choose the tax model, set up accounting, and take into account all legal requirements.

Acturon Consultation

The Acturon team helps IT companies obtain Diia.City resident status, choose the optimal tax model, organise accounting, and prepare the necessary reporting.

If you are planning to transition to Diia.City or want to assess the tax advantages of the regime, contact us for a consultation.

Запис Diia.City taxes: full guide спершу з'явиться на Acturon.

In this article, we explore how client expectations have changed, the role of technology, and why outsourcing has become the new standard for accounting services.

“Accounting is no longer a function. It has become a service.”

Ten years ago, accounting outsourcing in Ukraine was often seen as a compromise — an “external accountant” for small businesses, primarily used to reduce headcount and costs.

Today, the landscape is fundamentally different.

By 2026, accounting outsourcing has become a managed financial function that integrates accounting, tax, technology, risk control, and management reporting.

The market has undergone a deep transformation — and this explains why outsourcing is no longer an alternative, but the new standard.

2015–2018: From freelance accountant to structured processes

In the mid-2010s, the Ukrainian accounting services market was highly fragmented:

• dominated by sole practitioners and small firms
• accounting built around one individual
• manual, paper-based processes
• limited documentation and standardisation
• control based largely on personal trust

At the same time, businesses were rapidly evolving. Service companies, IT firms, and e-commerce were growing, while international clients and cross-border payments became more common.

Accounting could no longer remain local and manual.

This period marked a gradual shift:

• from individual → process
• from paper → digital tools
• from reactive accounting → controlled financial function

2019–2021: Remote accounting becomes the norm

The COVID-19 pandemic accelerated changes that had been building for years.

As businesses moved to remote operations, expectations of accounting services changed significantly:

• electronic documents and e-signatures became standard
• physical presence lost relevance
• demand increased for transparency, deadlines, and structured communication

This was a turning point for the market.

Clients began to buy not an “accountant,” but a service with clear rules:

• what is included
• who is responsible
• what the timelines are
• how quality is controlled

This is where the concept of Accounting as a Service began to take shape.

2022: War as a point of no return

The full-scale war in 2022 became the most serious stress test for business financial functions.

It exposed the weaknesses of traditional accounting models.

For many companies, outsourcing became not a matter of choice, but of business continuity.

During this period, outsourcing stopped being associated primarily with cost savings. Its core value shifted to:

• stability
• rapid recovery of processes
• regulatory risk control
• access to a team, not a single individual

2023–2026: Outsourcing as a full financial function

Today, Ukrainian businesses expect far more than basic compliance and reporting.

Modern accounting outsourcing includes:

• verification and control of primary documentation
• tax and regulatory support
• payroll and HR administration
• management reporting (cash flow, P&L, plan vs actual)
• integration with banks, CRMs, and payment systems
• financial analytics and discipline

The market is steadily moving toward the mid-market segment, where outsourcing effectively replaces an in-house finance function.

In summary, between 2015 and 2026, the accounting outsourcing market in Ukraine has changed fundamentally: individual practices have given way to a team-based service model, manual work has been replaced by automation and standardised processes, and the “cheap” approach has transformed into a focus on reliability and risk reduction. Accounting has moved beyond local tasks and has become a support function for international business models, while reactive problem-solving has been replaced by systematic prevention.

Accounting has become part of business management, its resilience, and scalability.

Outsourcing wins not because it is cheaper, but because it:

• ensures continuity of processes;
• reduces regulatory and operational risks;
• provides access to expertise that is difficult to maintain in-house;
• adapts faster to changes in legislation and technology;
• allows owners and management to focus on business growth.

That is why accounting outsourcing in Ukraine is not a temporary trend, but a new baseline model for financial services.

How Acturon operates within this framework

Acturon builds accounting outsourcing as a managed financial function, combining:

• professional expertise,
• technological solutions,
• structured processes,
• responsibility for results.

We believe that accounting should not be a “pain point,” but a foundation for business — today and in the future.

Запис Accounting outsourcing in Ukraine: How the market has changed over the past 10 years спершу з'явиться на Acturon.