Company registration and Diia.City residency support

Diia.City is a special legal and tax regime for technology business in Ukraine. In practice, however, obtaining resident status is only one of the stages.

Before filing the application, the company has to be properly registered and structured: its activities, the model of working with the team and the tax system all have to be defined. After the status is granted, the company must continuously monitor its compliance with the established criteria, formalise relations with employees and gig specialists, file reports and manage the risk of losing the status.

Separate conditions are provided for newly created technology companies, which may obtain resident status on the terms envisaged for startups, even if at the moment of joining they do not yet meet the requirements regarding nine specialists or an average remuneration equivalent to EUR 1,200.

Below we look at how to prepare a company for Diia.City properly and what has to be taken into account after the status is obtained.

What Diia.City is

The Diia.City legal regime is governed primarily by the Law of Ukraine “On stimulating the development of the digital economy in Ukraine” No. 1667-IX. A Diia.City resident may be a legal entity registered in Ukraine that meets the requirements of Article 5 of that Law.

According to the Ministry of Digital Transformation (August 2026), the Diia.City regime has more than 4,500 residents employing over 206,000 specialists.

The regime provides, in particular, for:

• a special model of working with gig specialists;
• special rules for taxation of specialists’ income;
• the option of a special corporate taxation regime;
• corporate and contractual instruments adapted to technology business.

As of 2026 the official Diia.City portal states the following main rates for specialists’ income: 5% personal income tax, 5% military levy and a unified social contribution of 22% of the minimum wage, provided that the criteria set by law are met. For corporate taxation, either the standard 18% corporate profit tax or a special 9% regime for the transactions specified in the Tax Code is possible.

At the same time, the tax model has to be chosen separately for each particular company — obtaining Diia.City resident status does not automatically make the 9% regime the reasonable choice.

1. Registering a company for Diia.City

If the business is only being created, preparation for Diia.City should preferably start before the state registration of the legal entity. Technology businesses most often use a limited liability company.

State registration of a legal entity is carried out under the Law of Ukraine “On state registration of legal entities, individual entrepreneurs and public formations” No. 755-IV. The version of the Law in force at the time of writing dates from 24 April 2026.

When setting up an LLC it is necessary, in particular, to define:

• the founders;
• the size of their shares;
• the amount of the share capital;
• the director;
• the legal address;
• the types of activity;
• the procedure for adopting corporate decisions;
• limits on the director’s authority;
• the procedure for transferring shares;
• the mechanism for investors entering and exiting.

The official registration procedure involves filing an application, the founders’ decision and — if the company is not going to use the model charter — its own constituent document. Registration documents may be filed on paper or electronically.

Why a standard template charter may not be enough

For a company that plans to:

• attract investors;
• build a product with several founders;
• transfer intellectual property rights;
• use option schemes;
• enter into significant contracts;
• join Diia.City,

a standard charter may fail to address all corporate risks. That is why the rules of interaction between the owners and the mechanisms of corporate control should be defined as early as the company formation stage.

2. Who can become a Diia.City resident

The general requirements are set out in Article 5 of Law No. 1667-IX. For standard residency a company must meet several criteria simultaneously.

Qualified activity

The company must carry out one or several types of activity defined by the Law. These include, in particular:

• software development and testing;
• software publishing and distribution;
• SaaS;
• cybersecurity;
• IT R&D;
• education in programming and IT;
• certain areas of digital marketing;
• robotics;
• activities related to certain technological and payment solutions;
• other areas provided for by law.

The official Diia.City portal publishes the list of qualified types of activity.

It is important that the relevant type of activity is stated in the charter and/or in the company’s records in the Unified State Register. This is directly required by clause 1, part 1, Article 5 of Law No. 1667-IX.

3. Financial and staffing criteria for an ordinary resident

As a general rule, a Diia.City resident must ensure:

At least nine specialists. The average number of employees and gig specialists must be at least nine people for each calendar month, starting from the month following the month in which the status was obtained.

Average remuneration of at least EUR 1,200. The average monthly remuneration of the engaged employees and gig specialists must be at least the equivalent of EUR 1,200 at the official NBU exchange rate as of the first day of the relevant month.

At least 90% of qualified income. The Law requires that at least 90% of the company’s total income is qualified income from the types of activity covered by the regime. This criterion is checked both for the initial period after joining and subsequently for calendar years.

In addition, the company must not be subject to the circumstances which, under part 2 of Article 5 of the Law, rule out holding resident status.

4. Diia.City for a startup: what is special

For newly created companies the Law provides a special mechanism. A legal entity may obtain Diia.City resident status on the terms of part 3, Article 5 of Law No. 1667-IX even if at the moment of joining it does not yet meet the standard requirements regarding:

• nine employees/gig specialists;
• average remuneration equivalent to EUR 1,200.

In the Diia.City Register such companies are given a separate note about obtaining the status under part 3 of Article 5 of the Law. In practice this mechanism is often called Diia.City residency on startup terms.

Requirements a startup has to meet

1. The company was created no more than 24 months ago. The state registration of the legal entity must have taken place no earlier than 24 calendar months before the day the residency application is filed. This period has to be counted precisely up to the date the application is filed.

2. The company must carry out qualified activity. The relaxation for startups does not mean that any activity is acceptable. The company still has to meet the requirement regarding the types of activity provided for by the Law and the qualified income criterion.

3. Income must not exceed the limit set by legislation. A special income criterion applies to startups. The Law ties it to the maximum income established by the Tax Code of Ukraine for single tax payers of the third group. This criterion applies not to one year only, but to the periods expressly defined in part 3 of Article 5 of the Law — in particular the year preceding the application, the year of the application, the year in which the status is obtained and the following calendar year.

For 2026 the maximum income for single tax payers of the third group is UAH 10,091,049 (1,167 minimum wages of UAH 8,647). For other years this amount has to be calculated separately.

That is why, when joining Diia.City, it is important to check not the company’s approximate turnover, but its compliance with the specific statutory limit for the relevant year.

How long the startup conditions last

A company may hold Diia.City resident status under the rules of part 3, Article 5 of the Law no longer than until 31 December of the calendar year following the year in which it obtained resident status.

For example: if a company became a resident on startup terms in 2026, the transitional period may last until 31 December 2027.

Before that period ends the company has to bring its operating model in line with the general requirements if it intends to keep the resident status.

The tax side deserves separate attention. The transitional period primarily concerns keeping the resident status: a startup may have fewer than nine specialists. The average remuneration criterion, however, affects the tax rate: if the average monthly remuneration of the specialists is below the equivalent of EUR 1,200, their income is subject to personal income tax at 18% rather than 5%. Startup terms therefore do not automatically mean the reduced rate applies. This is exactly why a startup has to plan in advance:

• hiring of the team;
• the level of remuneration;
• the income structure;
• the timing of gig contracts;
• the financial model.

5. How resident status is obtained

To obtain the status, a legal entity files the relevant application with the authorised body. Article 6 of Law No. 1667-IX defines the mandatory information the application must contain. In particular:

• the name and the company’s registration code;
• contact details;
• information about the officers specified by law;
• the types of qualified activity;
• the required representations as to compliance with the established requirements;
• for a startup — an indication that the application is made on the terms of part 3, Article 5 of the Law.

An application for taxation as a Diia.City resident — a corporate profit tax payer on special terms — may also be attached.

A legal entity obtains resident status from the day the relevant entry is made in the Diia.City Register.

6. Why a legal audit is needed before filing the application

Formally, the joining procedure is relatively simple. But the main risk lies not in filling in the application, but in whether the business actually matches the representations it makes there.

Before the documents are filed we recommend checking:

• the date the legal entity was created;
• the registered activity codes;
• the actual types of activity;
• contracts with clients;
• the income structure;
• the ultimate beneficial owners;
• the corporate structure;
• the number of employees;
• the current employment and civil law contracts;
• the forecast average remuneration;
• the tax model;
• the presence of circumstances that prevent obtaining the status.

For a startup it is additionally necessary to check the income criterion and the correct calculation of the 24-month period.

7. Gig contracts: a separate model of cooperation

One of the key features of Diia.City is the ability to engage gig specialists. Law No. 1667-IX defines a gig specialist as an individual who performs work and/or provides services to a resident on the basis of a gig contract.

This is a separate legal model, which is not the same as:

• an employment contract;
• a contract with an individual entrepreneur;
• an ordinary services agreement.

Therefore, using a template contract with an individual entrepreneur and simply renaming it a “gig contract” is the wrong approach. A gig contract has to be adapted to the specialist’s particular functions and should set out, in particular:

• the subject matter;
• the remuneration;
• the procedure for performing tasks;
• working time or another model of organising the cooperation;
• rights to the results of intellectual activity;
• confidentiality;
• liability;
• the procedure for terminating the cooperation.

8. Intellectual property for an IT company

For a technology business the key asset is not the office or the equipment, but:

• the source code;
• the design;
• the algorithms;
• the trade marks;
• the databases;
• the documentation;
• the content;
• the technological solutions.

That is why, when the company is created, it is necessary to define straight away who legally owns the rights to the product.

This is particularly critical if the product was initially created by:

• the founders before the company was registered;
• individual entrepreneurs;
• external developers;
• freelancers;
• foreign contractors.

Before an investment round an investor will almost certainly check the IP chain of title — the documented chain of transfer of rights from the authors to the company. Diia.City support is therefore best combined with an IP audit and the proper transfer of economic rights.

9. Reporting by a Diia.City resident

Obtaining the status does not complete the procedure. A resident has to confirm its compliance with the criteria. The Law provides for an initial compliance report and annual compliance reports.

The initial report is filed for the three full calendar months following the month in which the status was obtained. There is a specific feature for startups: as a general rule, an independent auditor’s opinion is not filed together with the initial report, however the Ministry of Digital Transformation may request it if discrepancies with the financial statements are found.

Subsequently, every resident must file a compliance report annually, no later than 1 June of the year following the reporting year. An independent opinion of an audit entity is attached to the annual report.

Missing the reporting deadlines may have significant consequences. The Law expressly provides for the possibility of losing the status, in particular where the compliance report and/or the independent opinion is filed more than 20 business days late, as well as in case of repeated consecutive breaches of the deadlines.

10. What legal support for a Diia.City resident covers

For a company it is important not only to obtain the status, but to stay compliant with the regime throughout its operation. Legal support may include:

• monitoring the residency criteria;
• checking the structure of qualified income;
• support for changes in the corporate structure;
• drafting and reviewing gig contracts;
• employment contracts;
• contracts with individual entrepreneurs and other contractors;
• NDAs;
• IP assignment agreements;
• contracts with clients;
• corporate documents;
• tax advice;
• preparation for reporting;
• coordination with the auditor;
• notifying the Ministry of Digital Transformation about changes;
• analysis of the risks of losing the status.

For startups it is especially important to track the moment when the company has to move from the transitional conditions to full compliance with the Diia.City criteria.

The mistakes we most often recommend preventing

Problems often arise not when the application is filed, but several months after the status is obtained. Typical risks include:

• incorrectly chosen activity codes;
• the company’s actual activity not matching the qualified areas;
• an insufficient share of qualified income;
• incorrect calculation of the average remuneration;
• the number of specialists falling below the required level;
• incorrectly drafted gig contracts;
• rights to the software product remaining with a founder or an individual entrepreneur;
• missed reporting deadlines;
• the income limit for a startup not being taken into account;
• the startup transitional period ending while the company still does not meet the general criteria.

The “let us obtain the status first and sort out the documents later” approach therefore creates unnecessary legal and tax risks.

What support from incorporation to Diia.City looks like

Stage 1. Analysis of the business model. We define the product, the types of activity, the team, the income structure, the owners and the planned financing.

Stage 2. Registration of the legal entity. We prepare the corporate structure, the charter, the founders’ decisions and the activity codes, and carry out the state registration.

Stage 3. Tax structuring. We analyse the optimal tax system and whether the special Diia.City regime makes sense.

Stage 4. Checking the residency criteria. We determine whether the company qualifies on general terms or can use the startup rules.

Stage 5. Filing the Diia.City application. We prepare the documents and support the filing.

Stage 6. Formalising the team. We prepare gig contracts, employment contracts, NDAs, IP documents and other necessary agreements.

Stage 7. Ongoing compliance. We monitor compliance with the criteria, corporate changes, reporting and the risks of losing the status.

Is it worth setting up a new company specifically for Diia.City

Not always. Sometimes it is better to adapt an existing legal entity. In other cases it makes sense to register a separate company, for example where:

• the IT line of business has to be separated;
• an investor is coming in;
• the intellectual property has to be separated;
• the existing company has non-core income;
• the existing legal entity does not meet the criteria of the regime;
• the startup is being created as a separate product.

This question has to be resolved before a new structure is registered, since a mistake at this stage may later affect taxation, investment, the ownership structure and Diia.City compliance.

Conclusion

Diia.City is not simply registration in a special register. For a business it is a comprehensive legal model covering:

• the corporate structure;
• taxation;
• hiring the team;
• gig contracts;
• intellectual property;
• reporting;
• compliance.

For newly created technology companies the law provides the possibility of obtaining the status on startup terms, which allows certain general staffing criteria not to be met during the transitional period. But this regime also sets clear requirements as to the company’s age, income, type of activity and subsequent transition to the general criteria.

ARGUS Consulting group supports IT companies at every stage of working with Diia.City: from registering the legal entity and building the corporate structure to obtaining resident status, including on startup terms, preparing gig contracts, formalising intellectual property and providing ongoing legal support to the resident.

Legislation and registers

• Law of Ukraine “On stimulating the development of the digital economy in Ukraine” No. 1667-IX — Article 5 (requirements), Article 6 (application), Article 9 (loss of status)
• Law of Ukraine “On state registration of legal entities, individual entrepreneurs and public formations” No. 755-IV
• Tax Code of Ukraine — taxation of Diia.City residents and the income limit for the third group of single tax payers
• Diia.City portal · Register of residents · Compliance report and independent opinion