The idea looks attractive. You rent an apartment for UAH 20,000 per month, rent it out by the day for UAH 1,200, and keep the difference. In practice, this model has three layers of risk, and the first two are legal. Let's examine them before doing the math, because without them, the calculation makes no sense.

First Risk: Without the Owner's Consent, the Scheme Is Illegal

Subletting rented property requires the owner's consent, and this is explicitly established by the Civil Code. Without such consent, the sublease agreement has no legal force. The practical consequences are as follows. The owner can terminate the main lease at any time, and you lose the apartment, the money invested in furnishing it, and your obligations to people who have already booked dates. In addition, the sublease agreement is entirely dependent on the main lease, meaning that if the main lease ends, the sublease terminates automatically, regardless of what is written in your agreement with guests. Therefore, the first thing you need to do is obtain the owner's written consent and include the relevant clause in the main lease agreement. A verbal agreement does not work here. It is worth understanding that most owners do not agree to this because daily rentals mean constantly changing occupants, greater wear and tear, and conflicts with neighbors.

Second Risk: Daily Rentals Constitute Entrepreneurial Activity

This is the most important part that materials describing this scheme as an easy way to make money tend to overlook. Short-term accommodation for guests is legally considered entrepreneurial activity rather than ordinary renting. This means that operating without registering as an individual entrepreneur is not a matter of receiving untaxed income but an administrative offense. As of 2026, the penalties are as follows. For a first offense, the fine is approximately UAH 17,000–34,000, and the income received may also be confiscated. For a repeated offense within one year, or if the income exceeds approximately UAH 1,664,000, the fine ranges from UAH 34,000 to UAH 85,000, and confiscation of the income received is mandatory. In other words, the risk is not limited to a fine: the money you have earned may also be seized.

Which Tax Group to Choose

If you register the business activity, the choice of tax group has a significant impact on the amount of tax you pay, and the logic is not immediately obvious. The first group is not allowed to rent out real estate at all. The second group has a fixed monthly payment, meaning the amount of tax does not depend on revenue. The restriction is that tenants can only be individuals or individual entrepreneurs using the simplified taxation system. The third group pays a percentage of revenue and has no restrictions on whom it can work with. A clear comparison of the monthly tax burden looks as follows. With revenue of UAH 20,000, an individual pays approximately UAH 4,600, the second group approximately UAH 4,500, and the third group approximately UAH 3,100. With revenue of UAH 40,000, an individual pays approximately UAH 9,200, the second group pays the same UAH 4,500, and the third group approximately UAH 4,300. With revenue of UAH 80,000, an individual pays approximately UAH 18,400, the second group again pays UAH 4,500, and the third group approximately UAH 6,700. In other words, as revenue grows, the second group becomes significantly more advantageous because of its fixed payment, and the difference compared with declaring income as an individual reaches four times. In addition, you will need the appropriate activity code in the register, submission of the form declaring taxable objects, and fiscalization of transactions.

Now for the Math

Let's calculate a typical Kyiv example, keeping in mind that the figures should be checked against your own circumstances. Long-term apartment rent costs approximately UAH 20,000 per month. In the mid-range segment, the daily rate is approximately UAH 800–2,000 per night, and this range accounts for roughly three-quarters of demand, while budget options costing up to UAH 800 attract noticeably less demand. Let's take UAH 1,200 per night and an occupancy rate of 60%, meaning 18 occupied nights per month. This generates approximately UAH 21,600 in gross revenue. Now for the expenses. Rent paid to the owner: UAH 20,000. Utilities: approximately UAH 2,500, with costs being higher than usual for daily rentals. Cleaning after each guest's departure: with ten stays, this amounts to approximately UAH 3,000. Consumables, meaning bed linen, hygiene products, and coffee: approximately UAH 1,000. Booking platform commissions, which are usually 15–18%, amount to approximately UAH 3,500. The result is a loss of approximately UAH 8,000, even before taxes, advertising, and one-time furnishing expenses are taken into account.

When This Model Works

The calculation leads to a specific condition. For subletting to generate a profit, gross revenue from daily rentals must exceed the cost of long-term rent by approximately 2.5 times, because that is how much commissions, servicing, utilities, and taxes consume. In practice, this means you need either a high nightly rate or high occupancy, preferably both. Such conditions exist in specific segments, including city centers in large cities, business-class housing, and properties near railway stations, hospitals, and transport hubs. In a residential neighborhood with an average apartment, the model does not work, which is precisely why most attempts end in the second or third month.

One-Time Investments

These are usually forgotten, even though they determine how many months it will take you to break even. Furniture and appliances for daily rentals cost noticeably more than for ordinary rentals because a complete set is required, including dishes, textiles, and small essentials. Professional photography for listings is another expense.

Several sets of bed linen are needed because it is impossible to wash everything after each guest and immediately accommodate the next one. You also need to pay the security deposit to the owner and the first month's rent in advance. Altogether, these expenses can easily exceed UAH 100,000 for a single apartment.

Risks That Do Not Exist With Long-Term Rentals

Seasonality and uneven occupancy mean that you pay for empty weeks out of your own pocket, because rent to the owner is due every month regardless of your revenue. Conflicts with neighbors and the condominium association may result in this activity being prohibited in the building. Guests may damage the property, and you are the one responsible to the owner. Bookings may be canceled at the last minute. Dependence on the security situation is another factor, since air raid alerts and curfew directly affect demand. There is also the risk that the owner will change their mind and terminate the agreement. It is also worth knowing that subletting is a separate area of increased scrutiny by the tax authorities, meaning this scheme is checked more thoroughly than ordinary rentals.

An Alternative Worth Considering

If you own an apartment, daily rentals offer better economics because the largest expense, namely rent paid to the owner, disappears from the calculation. In this case, the model with the same nightly rate and occupancy generates approximately UAH 12,000 in net monthly revenue, compared with approximately UAH 15,000 from long-term renting after taxes. The difference is small, but the workload is significantly greater. This is precisely why many property owners return to long-term renting after a few months of daily rentals.

Sources

Article 774 of the Civil Code of Ukraine concerning subletting; materials from accounting publications on liability for daily rentals without business registration and comparisons of tax groups; explanations from the Association of Taxpayers regarding real estate rentals by individual entrepreneurs; market data on daily rental rates.