183 Days for Salary, Your Country of Residence for Retirement Pensions: The New Japan-Ukraine Tax Treaty

The treaty between Japan and Ukraine to prevent the same income being taxed by both countries is now being replaced with a new one. Its formal name is the “Convention between the Government of Japan and the Government of Ukraine for the Elimination of Double Taxation with respect to Taxes on Income and the Prevention of Tax Evasion and Avoidance.” It was signed in Tokyo on February 19, 2024, and entered into force on August 1, 2025 (Ministry of Finance announcement). It was signed by Kuninori Matsuda on the Japanese side and Finance Minister Serhiy Marchenko on the Ukrainian side (the signature block of the treaty text).

Until then, the treaty used between the two countries was the one Japan signed with the Soviet Union in Tokyo on January 18, 1986, which Ukraine had succeeded to. The Ministry of Finance describes the new treaty as a “complete revision” of this old one. Alongside new tax rates for dividends, interest and royalties, the new treaty contains many provisions that directly concern people who live or work moving between Japan and Ukraine. A comparison of old and new tax rates and the sequence of dates is also set out in A Timeline of Japan and Ukraine.

When Does It Apply, and to What?

The treaty entered into force on August 1, 2025, but it is used in tax calculations only from the following year. According to the Ministry of Finance, in Japan, taxes based on a taxable year apply from the taxable year beginning on or after January 1, 2026, and other taxes apply to amounts taxed on or after January 1, 2026. In Ukraine, taxes withheld at source apply to amounts paid on or after January 1, 2026, and other taxes apply from the taxable year beginning on or after January 1, 2026.

There are two exceptions. Exchange of information between the tax authorities (Article 24) and mutual assistance in the collection of the other country’s taxes (Article 25) have applied from the date of entry into force, August 1, 2025, regardless of the date the tax was imposed or the taxable year (Ministry of Finance announcement, Article 28.3 of the treaty).

The taxes covered are, in Japan, income tax, corporation tax, special income tax for reconstruction, local corporation tax, and resident tax; in Ukraine, individual income tax and the tax on corporate profits (Article 2). Resident tax is among the taxes covered by the treaty.

Whose “Resident” Are You?

A tax treaty first sorts people by “resident of which country,” and then, by type of income, assigns which country may tax it. Whether someone is a resident is judged under each country’s own domestic law, based on things such as domicile, residence, or the location of a head office (Article 4.1).

For an individual who becomes a resident of both countries under their respective laws, Article 4.2 sets out an order for deciding which applies.

• The person is treated as a resident of the country where they have a permanent home available. If they have one in both countries, it is the country with which their personal and economic relations are closer (the country that is the center of their vital interests)
• If that cannot be determined, or if they have no permanent home in either country, it is the country where they have a habitual abode
• If they have a habitual abode in both, or in neither, it is the country of which they are a national
• If they are a national of both, or of neither, the two countries’ tax authorities decide by mutual agreement

For a person other than an individual, such as a company, that becomes a resident of both countries, the two countries’ authorities are to endeavor to determine the matter by mutual agreement, considering the place of its head office and the place of effective management, and, absent such agreement, the reductions and exemptions available under the treaty are not to be granted (Article 4.3).

Salary Is Divided by the “183 Days”

Article 14 deals with salary in cases such as someone employed by a Japanese company working in Ukraine, or someone working in Japan for a Ukrainian employer. The general rule is that the country where the work is performed may also tax it.

However, if all three of the following conditions are met, the country where the work was performed does not tax it, and only the country of residence taxes it (Article 14.2).

• The total number of days the person was present in the country where they worked does not exceed 183 days in any twelve-month period beginning or ending in the taxable year in question
• The remuneration is paid by an employer who is not a resident of the country where the work was performed
• The remuneration is not borne by a permanent establishment, such as a branch, that the employer has in the country where the work was performed

According to the National Tax Agency, two things have changed from the old treaty. One is how the day-count is done: it is now judged by whether the 183-day threshold is exceeded in “any twelve-month period,” even when that period straddles taxable years. The other is scope: this exemption now covers only remuneration from employment, and no longer covers remuneration for independent personal services.

Director’s fees received as a member of a company’s board may also be taxed in the country where the company is resident (Article 15). Income that entertainers or athletes derive from their personal activities in the other country may be taxed in the country where the activity took place, regardless of the 183-day rule for salary (Article 16).

Pensions, Students, and Teachers

Retirement pensions and similar remuneration may be taxed only by the country of which the recipient is a resident (Article 17). However, a retirement pension paid by a state or local authority for services rendered to that state is treated differently: as a rule only the paying country taxes it, and if the recipient is a resident of the other country and also a national of that other country, only the other country taxes it (Article 18.2). Which article a particular pension falls under needs to be checked case by case.

As for students and business apprentices, Article 19 provides that a person who is present in the other country solely for education or training, and who is (or immediately before that stay was) a resident of that other country, is not taxed by the country where they are staying on payments they receive for their maintenance, education or training that are made from outside the country where they are staying. For a business apprentice, this exemption is limited to one year from when the training first began. According to the National Tax Agency, this one-year limit was newly added in the new treaty. Income a student earns from a part-time job in the country where they are staying is not covered by this article.

The treatment of teachers has changed significantly. The old treaty had a provision exempting from tax, for up to two years from the date of first arrival, the remuneration for teaching of an individual temporarily present in the other country to teach at a university or similar institution (Article 17 of the old treaty). The new treaty contains no such provision. According to the National Tax Agency, a resident who, as of the date of entry into force (August 1, 2025), was entitled to benefits under the old treaty may continue to receive them until the time they would have lost that right had the old treaty remained in force (new treaty, Article 28.5).

Dividends, Interest and Royalties

For investment income, there is an upper limit on the tax rate the country where the income arises (the source country) may apply.

Income	Upper limit for the source country under the new treaty (Articles 10-12)
Dividends	5% (where the recipient company has held 25% or more of the paying company’s holding — voting shares if the payer is a Japanese company, or capital if it is a Ukrainian company — throughout a six-month period) / 15% (other cases)
Interest	Exempt (where received by a government, local government, central bank, etc.) / 5% (where received by a bank, insurance company, securities company, or a recognized pension fund, etc.) / 10% (other cases)
Royalties	5%

Whether a resident of Japan is claiming this reduction, or a resident of Ukraine is claiming it in Japan, the procedure follows each country’s own system. According to the National Tax Agency, for a resident of Ukraine to receive a reduction or exemption under Japanese withholding, they must submit an “application form concerning income tax convention” to the district director of the tax office, through the payer (the withholding agent), no later than the day before the first payment made on or after January 1, 2026.

If You Still End Up Taxed by Both

Even for income that the treaty allows one country to tax, the other country may still tax it as the country of residence. Article 21 sets out how double taxation is then eliminated.

• Resident of Japan: the amount of tax paid in Ukraine is credited against the Japanese tax (foreign tax credit). The amount that can be credited is limited to the portion of the Japanese tax that corresponds to that income
• Resident of Ukraine: the amount of tax paid in Japan is credited against the Ukrainian tax. The amount that can be credited is limited to the portion of the Ukrainian tax that corresponds to the income Japan may tax. Income exempted from tax in Ukraine under the treaty may still be taken into account when calculating the tax on the remaining income

A person who has been, or thinks they will be, taxed in a way not in accordance with the treaty can, separately from any domestic appeal, present their case to the tax authority of either country. The deadline is three years from the first notification of that taxation (Article 23.1). If the authorities cannot reach agreement within two years of having the necessary information, unresolved issues are referred, at the person’s written request, to arbitration by three arbitrators (Article 23.5 and Protocol paragraph 3). The Ministry of Finance names the introduction of this arbitration as one of the pillars of the revision.

Cooperation Between the Tax Authorities, and Preventing Abuse

The new treaty provides for the two countries’ tax authorities to exchange information (Article 24) and to help each other collect taxes owed to the other country (Article 25). This mutual assistance in collection is not limited to income taxes: on the Japanese side it covers taxes such as consumption tax, local consumption tax, inheritance tax and gift tax; on the Ukrainian side, value-added tax, excise tax, property tax and others. Both have applied since August 1, 2025.

Where it is reasonable to conclude that obtaining the treaty’s benefits was one of the principal purposes of a transaction or arrangement, those benefits are not granted (Article 27.2). There is also a rule that benefits are not granted for income attributable to a branch or similar establishment in a third country when the tax there falls below a certain level (60% of the tax that would apply if that branch were located in the country in question) (Article 27.1).

The Soviet Treaty Still Lives On for Other Countries

The Ministry of Finance’s announcement notes that this new treaty does not affect “the tax treaties currently applied between Japan and countries other than Ukraine,” meaning the 1986 treaty with the Soviet Union. The Ministry of Finance’s list of tax treaties (as of June 26, 2026) carries a note, for Armenia, Kyrgyzstan, Tajikistan, Turkmenistan, Belarus and Moldova, that the old Soviet treaty has been succeeded to. The same list still shows the 1986 old treaty in the column for Ukraine, too. This point needs care when checking the list.

The treaty sets out a framework; which article a particular item of income falls under, and of which country a person is a resident, depends on the facts of the case. This article is based on the treaty text and on Ministry of Finance and National Tax Agency materials as of September 2026. For actual filing and withholding, please check with a tax office or a tax accountant. The contract and remittance issues involved when a Japanese company hires a Ukrainian engineer are covered in Before Contracting with a Ukrainian Engineer.