The Ministry of Finance by Order No. 317 of June 04, 2021 (registered with the Ministry of Justice dated August 04, 2021 under No. 1014/36636) made amendments to the Corporate Income Tax Return Form: a new line 7.1 was added to the tax return, as well as amendments were made to the Appendices Withholding Tax, Differences and Amortization.

The updated tax return form came into force on August 17, from the date of publication. The Order was published on August 17, 2021 in Official Gazette No. 63.

According to clause 46.6 of the TCU, the updated tax reporting forms must be used for reporting for the period following the period of their official publication. Since the Order was approved and published in August 2021, for the first time, the updated income tax return form will be used to report for Q4 2021.

The tax return has been brought into compliance with the current norms of the TCU (taking into account the amendments made by the Laws No.466, No. 786, No. 962, No. 1072 and No. 1117). Namely:

  1. 1. A new line 7.1 was added to the tax returnregarding the reflection of information when a non-resident carries out activities on the territory of Ukraine through a permanent representative office, taking into account the amendments adopted by Laws No. 466, No. 786, No. 1117 to subclause 133.2.2and subclause 141.4.7 of the TCU. The footnote, in particular, clarifies that if a non-resident carries out activities on the territory of Ukraine through a permanent representative office, the USREOU code of such a permanent representative office must be indicated. If a non-resident carries out activities through an uncredited separate subdivision, the ID of the taxable object must be indicated according to the notification of such a taxable object submitted to the supervisory authority following the requirements of clause 63.3 of the TCU.
  2. Amendments have been made to the Appendices to the Tax Return:

– in the Appendix on Withholding Tax regarding the possibility of reflecting information about a non-resident who is a beneficial (actual) recipient (owner) of income with a source of origin from Ukraine in case of the application according to Article 103 of the TCU of the provision of an international treaty of Ukraine with the country where the corresponding beneficial (actual) recipient (owner) of such income is a resident. Namely, the “Mark on the absence of the status of a legal entity” has been supplemented with a new position.

– in the Appendix on Differences – about:

  • exclusion of the difference by which the financial result increases before tax – by the amount of expenses incurred by the taxpayer when performing operations with non-residents if such operations do not have a business purpose (revision of subclause 140.5.15 of the TCU was valid until January 01, 2021);
  • addition of a new difference to increase the financial result before taxation of the tax (reporting) period by the amount of expenses related to the fulfillment of the terms of the budget grant agreement incurred in the current reporting period at the expense of such grants (but no more than the amount of such grants) and included in the expenses of the current reporting period according to the National Accounting Regulations (Standards) or International Financial Reporting Standards (subclause 140.5.16 of the TCU);
  • addition of new differences regarding the reduction of the financial result before taxation of the tax (reporting) period:
  • for the amount of budget grants received by the taxpayer and included in the income of the reporting period according to the National Accounting Regulations (Standards) or International Financial Reporting Standards (subclause 140.4.8 of the TCU);
  • for the amount of one-time compensation received to business entities according to the Law of Ukraine “On Social Support for Insured Persons and Business Entities for the Period of Implementation of Restrictive Anti-Epidemic Measures Introduced to Prevent the Spread of Acute Respiratory Disease COVID-19 Caused by Coronavirus SARS-CoV-2 on the Territory of Ukraine” and included in the income of the reporting period according to the National Accounting Regulations (Standards) or International Financial Reporting Standards (clause 54, Subsection 4, Section XX of the TCU);
  • for the amount of sanctions and penalties written off according to clause 23 and tax debt written off according to clause 24, Subsection 10, Section XX of the Code and included in the income of the reporting period according to the National Accounting Regulations (Standards) or International Financial Reporting Standards (clause 54, Subsection 4, Section XX of the Code);

– in the Appendix on Amortization, after the line under code A17, it is supplemented with a new line of CI with the following content: “Capitalized interest included in the cost of non-current assets (subclause 138.3.2, clause 138.3, Article 138, Section III of the Tax Code of Ukraine)”.

For the first time, the updated income tax return form will be used to report for Q4 2021.