This law provides even more tax and customs benefits to support Ukrainian entrepreneurs during hostilities. The normative act came into force after its publication in the official publication “Voice of Ukraine” on April 16, 2022.
EBS tax practice expert Marina Zhimolostova analyzed the already known changes in the Tax Code. So, let’s talk about them.
- Single tax:
1.1. Restrictions of UAH 10 billion for staying in group 3 of the single tax at the rate of 2% during martial law are lifted.
1.2. The list of activities of economic entities that may be payers of the single tax of group 3 at the rate of 2% for the period of martial law has been expanded. It is determined that they can be payers:
– business entities engaged in retail trade in excisable goods, as well as
– enterprises providing services of centralized water supply and sewerage, extracting groundwater and surface water.
- Income tax:
2.1. Taxation of income taxpayers who have temporarily switched to the payment of the single tax of group 3 is carried out considering such nuances:
– overpaid amount of income tax liabilities, advance payments of income tax on dividends, negative value of the object of income tax, interest more than the amount of the limit specified in paragraph 140.2 of the NKU, are considered to determine the object of income tax after resumption of payment of this tax;
– if a payer who switched to a single tax during a calendar year resumes the payment of income tax in the same year, such payer prepares and submits a corporate income tax return on a cumulative basis from the beginning of such calendar year and does not consider the results of activities during the stay on the single tax, considering the provisions of subdivisions. 4 sec. XX NKU;
– the amount of annual income of the payer of income tax for the purposes of transfer pricing (Article 39 of the Tax Code), for the application of differences (paragraph 134.1.1 of the Tax Code) and the annual / quarterly tax period (paragraph 137.5 of the Tax Code) is calculated for the entire reporting year. including considering the income received during the periods of being on the single tax at the rate 2 %.
2.2. The list of purposes for which non-profit organizations can spend funds and which are not defined in the charter has been expanded, namely the provision of charitable assistance to individuals who are not founders, members of such organizations or related persons and residents. settlements where (and were) conducted hostilities, and / or forcibly left the place of residence in connection with the conduct of hostilities in such settlements, including registered in the social protection of the district, district in Kiev state administrations, executive bodies of city, district in cities (in case of formation) councils.
- Personal income tax:
3.1. The list of charitable assistance not included in the taxable income of individuals has been expanded, namely charitable assistance spent or received for further payment by philanthropists, including philanthropists – individuals included in the Register of Volunteers of the Anti-Terrorist Operation, and / or implementation of measures to ensure national security and defence, resistance and deterrence of armed aggression of the Russian Federation in the manner prescribed by the Law of Ukraine “On Charitable Activities and Charitable Organizations”, in favour of participants in hostilities – servicemen, APU, National Guard, SBU, State Border Service and other formations the list defined by paragraphs. a) and b) paragraphs. 165.1.54 NKU.
- Value added tax:
4.1. For electricity suppliers, it is determined that the date of occurrence of tax liabilities for VAT is the date of the document certifying the fact of supply of electricity, both in paper and electronic form.
4.2. Exemptions from VAT are levied on the import and supply in the customs territory of Ukraine of flat, safe glass, optical tracking devices, equipment for transmitting and receiving voice, images and other information, directional listening equipment, radios of ultra-shortwave and shortwave range, military -signal equipment, their parts and accessories, unarmed unmanned aerial vehicles and their parts, meteorological stations, armoured vehicles, the final recipient of which according to the certificates of the end user or according to the terms of the contract determined law enforcement agencies, Ministry of Defence of Ukraine, APU and other military formations, voluntary territorial communities and other entities engaged in the fight against terrorism in accordance with the law and / or involved in the implementation of measures to ensure national security and defence, resistance and deterrence of armed and graces of the Russian Federation.
- Excise tax:
5.1. For excise taxpayers who are producers of electricity, the date of occurrence of tax liabilities on excise tax on transactions for the sale of electricity:
– temporarily, from March 1, 2022, until the termination or cancellation of martial law – the date of crediting (receiving) funds to a bank account or the date of receipt of other types of compensation for electricity sold;
– from the first tax period following the period of cessation or cancellation of martial law – the date of the document certifying the supply of electricity (for electricity sold from the first tax period following the period of cessation or cancellation of martial law, state of emergency in Ukraine) and the date of crediting (receiving) funds to the bank account or the date of receiving other types of compensation (for electricity sold in the period from March 1, 2022 to the last tax period in which martial law was terminated or revoked, inclusive).
5.2. Subject to excise tax exemption are operations on import into the customs territory of Ukraine and supply in the customs territory of Ukraine of classified armoured vehicles with codes 8702 10 19 90, 8702 90 11 00, 8703, respectively, UKT FEA, the final recipient of which according to law enforcement agencies, the Ministry of Defence of Ukraine, the Armed Forces of Ukraine and other military formations, voluntary formations of territorial communities, etc. formations that carry out the fight against terrorism and / or participate in the implementation of measures to ensure national security and defence, resistance and deterrence of armed aggression of the Russian Federation.
- Carrying out inspections:
6.1. The inspection report sent by the controlling body to the electronic office is considered handed over to the taxpayer if it is formed in compliance with the requirements of the laws of Ukraine “On electronic documents and electronic document management” and “On electronic trust services”.
6.2. The period of submission and consideration of objections, additional documents and explanations, acceptance, sending and appeal of the tax notification-decision is suspended.
6.3. For the period before the termination or abolition of martial law, the tax authorities also carry out state control (supervision) and supervision in the field of pricing, according to the Law of Ukraine “On Prices and Pricing”. Tax authorities send the materials (act) of such inspections to the bodies authorized to decide on the application of administrative and economic sanctions for violation of the requirements for the formation, establishment, and application of state regulated prices.
6.4. The actual inspection may also be carried out based on information from government agencies or local governments, indicating possible violations by the taxpayer of legislation on prices and pricing or written appeal to the buyer (consumer) about the taxpayer’s violation of the established procedure.
6.5. Taxpayers may submit to the supervisory authorities in any form a notice of the impossibility of exporting primary documents, signed by the head of the enterprise and the chief accountant, which indicates:
– circumstances that led to the loss and / or impossibility of export of primary documents,
– tax periods as well
– general list of primary documents.
The submitted message is the basis for saving costs, the negative value of the object of taxation of income tax, value added tax credit, the amount of the negative value of value added tax of past tax (reporting) periods.
After submitting to the supervisory authority, a report on the impossibility of exporting primary documents in connection with their presence in the settlements where hostilities are (were conducted), a moratorium is imposed on documentary inspections of tax periods specified in the report.
The list of territories of settlements where hostilities are carried out is determined by the Cabinet of Ministers of Ukraine.
- Customs changes
7.1. Operations on import of goods, the final recipients of which are law enforcement agencies, such as the APU and the Ministry of Internal Affairs, are exempt from customs duties.
The effect of all these innovations will be effective only in hostilities on the territory of Ukraine. So, the law is only a temporary measure and will cease to operate after the end of military aggression by the Russian Federation.
The article was written by tax expert Marina Zhimolostova for the LIGA:Zakon.