The treaty establishes the first bilateral agreement between Australia and Ukraine and aims to eliminate double taxation on income, capital, fringe benefits, and withholding tax while preventing tax evasion or avoidance.

Australia and Ukraine have signed an income tax treaty on 16 October 2025.

The agreement will eliminate double taxation concerning taxes on income, capital, fringe benefits, and withholding tax without creating opportunities for non-taxation or reduced taxation through tax evasion or avoidance between the two countries.

The treaty will provide a general withholding tax rate of 15% on dividends. Intercorporate dividends on non‑portfolio holdings of at least 10% will get a 5% rate. This lowers Australia’s default rate (30%) by at least 15% for Ukrainian businesses. This will encourage them to invest in Australia. It reduces Ukraine’s current rate (18%) by at least 3% for Australian businesses investing in Ukraine. This will lower the cost of doing business for Australians in Ukraine.

The treaty will provide a general withholding rate of 10% on interest. Interest derived by a financial institution will get a 5% rate if it is unrelated to and dealing wholly independently with the payer. This lowers Ukraine’s current rates (18%) by 8% for Australians investing in Ukraine.

Australia’s rate will stay at 10% for all other Ukrainian investors.

The treaty will provide a rate of 10% on royalties. This reduces Australia’s default rate (30%) by 20%. This makes it cheaper for Australians to access Ukraine’s intellectual property. It lowers Ukraine’s current rate (18%) by 8%. This incentivises Ukraine to use more Australian intellectual property.

The agreement will take effect after the exchange of ratification instruments. In Ukraine, it will apply from 1 January of the year after entry into force. In Australia, it will apply to withholding taxes from 1 January, to fringe benefits tax from 1 April, and to other taxes from 1 July following its entry into force.

Earlier, Ukraine’s Cabinet of Ministers approved the signing of an income tax treaty with Australia on 17 September 2025.