How to register a resident in Diia.City? What is it and how does it work?

The author of the article: Philipp Orlov

Modified date: 27 November 2025

Diia.City is a state “sandbox” for IT companies: a 9% tax on withdrawn capital, a personal income tax for specialists of only 5%, plus legal gig contracts and official booking of key employees. In the article, I explain who can join the regime, what criteria to have (a minimum of 9 people on the team, an average remuneration of €1200, and 90% of income from IT activities), which documents to submit online through the Diia portal, and what a resident’s reporting looks like. I break down the advantages and risks with practical examples so that you can honestly calculate whether Diia.City is right for your business.

This article is for those who have already built an IT business or are just dreaming about launching their own startup. Do you want to work transparently, attract investments, avoid unexpected inspections, and protect your team even in the most challenging times? Then you definitely need to understand what Diia.City is and why this regime is a real game changer for Ukrainian IT today — and how it helps companies move away from the outdated FOP model toward modern gig contracts. We will break down practical examples — who can become a resident, what advantages it offers, and what tax and legal nuances you should pay attention to. And also — how Diia.City residency allows companies to reserve key specialists.

What is Diia.City

There are thousands of ambitious IT entrepreneurs in Ukraine who aim to grow their startup into a global player. But the old taxation system and complicated legal requirements often become a real burden for development — and scare people away right at the start. Sounds familiar?

That is exactly why the government launched the special regime Diia.City. Imagine a next-generation business passport: instead of the classic corporate income tax — you have a tax on withdrawn capital, instead of traditional employment agreements — gig contracts, European-level IP protection, investor-friendly guarantees, and many more benefits designed for the digital economy.

The rules of the game are defined by the Law of Ukraine No. 1667-ІХ “On Stimulating the Development of the Digital Economy in Ukraine”.
Becoming a resident is voluntary: a company submits an application to the Ministry of Digital Transformation, and once it is added to the register — you are officially part of the Diia.City “club”.

By the way, for most IT companies that want to obtain employee reservation status, Diia.City residency is now practically the only effective option. In addition, Diia.City residents receive more loyal tax conditions, look more attractive to foreign clients, and inspire much more confidence among investors. However, many CEOs and business owners still worry: “Will the budget handle the new model?”, “Will international partners understand and appreciate Diia.City?”, “Is it risky to switch from the familiar FOP scheme?”. And that’s exactly what we’ll break down further.

If questions arise — don’t wait. Reach out to an accountant or legal expert who can help you understand the details specifically for your business.

How Diia.City differs from the classic IT model (with FOP contractors)

Diia.City is not just another “government initiative”, but a unique concept that previously did not exist in Ukraine — or in most countries around the world. Initially, this regime was designed solely for Ukrainian IT, but over time, defense-tech companies (for example, drone manufacturers) and developers of innovative prosthetics were also included.

What’s the core idea? Imagine an “ecosystem” where the state officially recognizes the unique way the IT sector operates and solidifies it in law. It’s like receiving an “official pass” to use flexible collaboration formats instead of outdated and rigid employment agreements.

Additionally, Diia.City offers:

• Significantly lower taxes on payments to specialists compared to standard payroll taxes in Ukraine.
• The ability to legally use globally popular instruments: NDA, stock options, convertible loans — all the tools that have long been standard in the West can now be officially applied in Ukraine.
• And most importantly — an emphasis on innovation and fast growth. Diia.City is designed so that companies can scale without bureaucracy.

Why companies choose Diia.City: key advantages

All these nuances may look complicated at first, so it’s best to discuss them with a professional accountant or legal expert. Scheduling a consultation is the first step toward confidence in choosing the right cooperation model!

How to become a Diia.City resident

Becoming a Diia.City resident is not just a “checkbox” for image: reduce taxes, attract stronger specialists, and look more appealing to investors. It is a strategic decision that changes your taxation model and the rules of interaction with your team.

So where should you start? First — honestly answer the question: what does your company actually do?

If your company operates in IT, technology, or innovation, and your main income consistently comes from these activities, then Diia.City residency is definitely worth considering. But simply “fitting the industry” is not enough. It is important to make sure your company can maintain this activity profile in the future and remain within the required criteria.

Imagine:

for a large product company, Diia.City is an opportunity to legally hire top specialists, attract investments, and scale confidently. But for a small outsourcing team, this may become a challenge: will you be able to consistently maintain the required income profile? Are you ready for new transparency requirements? Do you really need flexible gig contracts instead of FOPs? Will the company become stronger and more appealing to partners?

To understand this, you need to take several steps:

• Assess benefits and risks. If you currently pay 18% corporate income tax, in Diia.City you can switch to the 9% tax on withdrawn capital (TWC). It looks attractive, but remember about audits, strict reporting, and income control.
• Review your collaboration model. Are you ready to replace FOP contractors with gig contracts? This is not only about legal changes but also about a new internal company culture.
• Recalculate your economics. How much money will actually remain after the transition? Will it allow you to reinvest in growth and properly motivate your team?
• Taxes for employees. In Diia.City, personal income tax is only 5%, so specialists receive more net income, and the company saves on payroll costs. This is a strong competitive advantage in attracting talent.

Who can become a Diia.City resident? Requirements and entry criteria

Any legal entity registered in Ukraine can become a Diia.City resident — regardless of where your office or team is physically located, and even if you work fully remotely.

The key requirement — compliance with the established criteria.

Your company has been working remotely for years or has no office in Kyiv at all? This is not a problem. The only requirement is Ukrainian registration and compliance with Diia.City rules.

If you are unsure whether your legal form is suitable — it’s better to consult an accountant or legal expert right away to avoid mistakes at the start.

1. Types of activity

The company must operate in specific fields, such as:

• computer programming, IT consulting, operation of computer equipment;
• publishing computer games and other software;
• providing software products online and offering web services for delivering software applications;
• educational activities in the field of information technologies;
• web portal operation;
• data processing and related activities (excluding providing data processing infrastructure, hosting, or hosting services);
• research and experimental development in natural and technical sciences related to information technologies;
• conducting marketing campaigns and providing advertising services using software developed with the participation of a Diia.City resident, online and/or on user devices;
• activities of esports organizers, esports teams, specialized computer centers and/or clubs for esports competitions, as well as esports broadcasting studios;
• cybersecurity of information and communication systems;
• designing, researching, testing technologies, devices, and robotics systems using computerized control systems;
• providing services related to virtual asset circulation.

2. Salary level

Starting from the month after obtaining residency status, the company’s average monthly remuneration must be at least 1,200 euros (according to the NBU rate).

3. A team of at least 9 people

The company must have at least 9 employees and/or gig-specialists. You can combine them flexibly: for example, 5 employees + 4 gig specialists.

4. Share of qualified income

At least 90% of the company’s income must come from the activities permitted for Diia.City — both for the first three months after joining and for every subsequent year.

Simplified conditions for startups
Young companies benefit from relaxed requirements to support innovative ideas and give them a better chance in the market.

How to register a Diia.City resident

In reality, the application process is extremely simple and entirely online. No queues in offices, no permits or licenses — only digital format. Once you ensure your company meets all requirements, you just need to submit an application.

By the way, here is a step-by-step video guide from Diia showing how to submit the application.

To register, you need:

• Fill in applicant details: EDRPOU code, name, and legal form of the company.
• Specify the types of activities the company plans to perform as a resident.
• Enter personnel data.
• Add a power of attorney if necessary.
• Sign the application with an electronic signature.

By law, the Ministry of Digital Transformation must respond within 10 working days. But in practice everything happens much faster. And now — an important nuance that is often overlooked! The principle of “silent consent” applies. This means: if you do not receive a response within 10 days, you may consider your Diia.City residency approved automatically. Convenient, right?

The Ministry’s decision — return of the application without review, approval, or refusal — is sent to your e-mail with full explanations. And all approved companies are added to the official Registry of Residents of Diia.City. You receive notifications both by e-mail and in your Diia account.

Why your residency application may be returned without review

The company’s registration data is incorrect or contains errors.

There is no record in the Unified State Register confirming the company’s registration — for example, if an individual entrepreneur (FOP) tries to obtain residency.

No confirmation has been provided that the company does not fall under the anti-criteria.

No confirmation has been provided that the company will comply with the established requirements.

The Unified State Register has no information about the authorized person who submitted the application, or their authority cannot be confirmed (for example, if a representative applies without a power of attorney).

The applicant requested the return of the application.

Examples of applications and instructions:

Reporting and taxes of a Diia.City resident

1) Types of reports and deadlines

The compliance report is submitted by everyone holding Diia.City residency. This is required by the Law of Ukraine No.1667 “On Stimulating the Development of the Digital Economy”.

• Initial report — for the first 3 full calendar months after obtaining residency. Important: this report must be submitted within 6 months after receiving the status. An independent auditor’s opinion must be attached, unless you fall under the exception.
• Annual report — covers the entire calendar year (January 1 — December 31). The first annual report is submitted for the period from the month following the month of residency approval until the end of the year. An auditor’s opinion must also be attached.
  

Please note that the auditor’s opinion must be provided by a certified auditing entity — the list is published on the ACU website.

How is the submission date determined?

The submission date is considered the moment you receive automatic electronic confirmation of acceptance. Therefore, it is important to keep this confirmation.

2) Resident taxes: what the rate consists of

• Personal income tax (PIT) — 5%
• Unified social tax (UST) — 22% of the minimum wage
• Military levy — 5%
  

Regarding corporate tax — you can choose:

• 9% tax on withdrawn capital
• or 18% corporate income tax.
  

3) How to switch to the special tax regime?

To apply the preferential taxation of Diia.City, it is important not to forget one more step — to submit a special electronic application. It can (and should!) be sent together with the residency application. Why is this important? Under the Tax Code, if the application is submitted on time, you automatically become a taxpayer under the special regime from the first day of the month following the quarter in which you were added to the registry. Imagine applying but “forgetting” this additional application: in that case, the preferential taxation begins later — or may be lost entirely. Don’t take the risk!

Example: 

Booking employees in Diia.City

For most IT companies, Diia.City residency is practically the only way to begin the employee booking process. But is simply “obtaining the status” enough? First, a Diia.City resident must obtain the status of a critically important company for the economy. To qualify, it must meet the following requirements:

1. No tax debts (a certificate is required).
2. The average salary in the company — at least 2.5 minimum wages.

Once the company receives this status, it may proceed with booking employees. However, certain rules also apply here.

Only military-liable men aged 25 to 60 can be booked. Women and conscripts/reservists are not eligible for booking. 

Before booking, the company must: check military registration documents; assess the possibility of deferments; plan the booking.

Restrictions: booking usually does not exceed 50% of staff, or another percentage agreed with the General Staff or the Ministry of Economy.

Diia.City residents are allowed to book specialists for 12 months with the possibility of extension.

Booking an employee is usually successful under the following conditions:

• Up-to-date employee data: the employees must have updated records.
  
• No TCC search notices.
  
• The person must be on military registration. If they updated their data but their account shows “Not on military register,” such individuals cannot be booked.
• If individuals previously had the status “limited fitness”, they must pass the military medical commission on time, otherwise their data is not updated.
  

After successful booking, you obtain the legal right to send booked employees on business trips abroad. In addition, the law allows these categories of employees to travel for foreign vacations.