The Verkhovna Rada of Ukraine adopted the Law of Ukraine “On Amendments to Certain Legislative Acts of Ukraine” of 06.12.2016, № 1774-VIII, which introduced the following innovations.
Regarding wages
The term “minimum wage” changed. Currently, it is a statutory minimum rate of labour payment for rate of work operated monthly (hourly) by an employee. The minimum wage is a state social guarantee that is mandatory throughout the territory of Ukraine for enterprises, institutions and organizations of all forms of ownership and management and individuals that use hired workers on any system of remuneration.
The minimum wage is 3 200 hryvnias from January 1, 2017.
Henceforth the minimum wage includes bonuses, allowances and compensation, but when calculating the wage size of the employee for its minimal size, there are not taken into account the additional payments for work in unfavourable working conditions and increased health risks, for night work and overtime, itinerant nature of work, bonuses for holidays and anniversaries.
Regarding payment of the unified contribution
There was established the norm for unified tax payers of the 1st group, according to which the amount of the unified contribution should not be less than 0.5 of the minimum premiums (with enrolment to the insurance period in proportion to the unified contribution paid).
The amount of the unified contribution paid by FOP (self-employed individual) on the general system of taxation can not be less than the amount of minimum insurance premium per month (even if not received income (profit) in the reporting year or certain months of the reporting year, the amount of the unified contribution can not be less than the amount of minimum insurance premium).
The Verkhovna Rada of Ukraine adopted the Law of Ukraine “On Amendments to the Tax Code of Ukraine on improving the investment climate in Ukraine” of 21.12.2016, № 1797-VIII, which introduced the following amendments.
Administration of taxes and duties
From January 1, 2017, only service functions are assigned to the regional tax inspections. Control and verification works will be carried out only at the regional level.
In addition, the electronic office of the taxpayer was introduced. Its main purpose is to transfer communication of taxpayers with tax authorities in the electronic format.
There were changed the criteria of belonging of the taxpayer to the category of large taxpayers. Thus, it is increased the rate of payments to the state budget for payments controlled by SFSU, from UAH 12 to UAH 20 million, and the amount of income criterion of all activities in the last four consecutive tax (reporting) quarters form UAH 500 million to UAH 1 billion.
The State Fiscal authorities are empowered to make decisions on registration or refusal of registration of tax invoices and adjustment calculations.
Also, it is established the responsibility of public (service) officials of controlling authority for making unlawful decisions, which determine tax (monetary) liabilities to the taxpayer.
Corporate income tax
Financial reporting prepared and submitted by the payers of income tax and non-profit companies, institutions and organizations is an addition to the tax return for income tax (report on the use of income (profit) of non-profit organization and its integral part (para. 46 of the Tax Code of Ukraine (hereinafter − TCU). Therefore, if there is no financial reporting, the tax returns can be not accepted.
The payers of income tax – the agricultural producers, who choose an annual tax (reporting) period in accordance with sub-para.137.4.1 of TCU, should prepare and submit with appropriate tax return the financial reporting for the last reporting year and the first half the current reporting year.
Non-profit companies, institutions and organizations determined by para.133.4 of TCU should submit a report on the use of income (profits) of non-profit organization and annual financial statements.
PIT
The incomes form lease (sale) of ferrous metals (code 7204 UCCFEA (Ukrainian Commodity Classification for Foreign Economic Activity) are exempt from taxation on personal income tax (hereinafter − PIT) form 2017.
In addition, it is increased to three minimum wages, the amount that a legal or an individual can pay for studying of another individual in higher and vocational domestic institutions of learning without taxing of such amount of PIT, and it is abolished the necessity of an individual, who studies, to work for that one who paid for such training during three years.
It is established the taxation at the rate of 9% of passive income from dividends on shares, investment certificates and corporate rights, paid by business entities that are not subject to company income tax.
It is increased the rate of per diem – for business trips within Ukraine to 0.1 minimum wages per day (UAH 320 in 2017), for business trips abroad − 80 Euros per day.
It is determined that the amounts of the excise tax of excise goods retailers are not included neither in incomes nor in expenses of the individual – entrepreneur.
VAT
The product code according to UCCFEA and service ID according to the State classification of goods and services are established as a mandatory requisite of tax invoice for any and all goods and services.
Since the New Year it is changed the deadlines of the registration of tax invoices and adjustment calculations to them in the Unified register of tax invoices (hereinafter – URTI):
- for tax invoices/adjustment calculations prepared from 1 to 15 days (inclusively) of calendar month – to the last day (inclusively) of the month in which they were prepared;
- for tax invoices/adjustment calculations prepared from 16 to the last day (inclusively) of calendar month – to 15th day (inclusively) of the month following the month in which they were prepared.
It is improved the system of electronic administration of the value added tax (hereinafter − VAT). For example, VAT refund will be made within the funds available in the unified treasury account.
Excise tax
The obligation of companies to have flow rate meters and uniformly meters transferred from 01.01.2017 to 01.01.2018.
Payment for land
It is established that the minimum amount of rent for the land of the state and municipal property can not be less than the size of the land tax established for relevant category of land in a particular area.
Immovable property tax
If individuals use their residential property in order to obtain incomes or if the area of their apartments and houses is more than 30 m2, it is provided that such owners are not provided benefits as a reduction of taxable area of residential facility and the local government has no right to give exemptions from paying property tax on such facilities.
Simplified taxation system
When calculating the total amount of employed persons by the individual – entrepreneur, who is the unified tax payer, employees called up for military service during mobilization and the special period will not be taken into account since 2017.
Also, it is clarified that the last tax period of the unified tax payer, who stops his/her business and accordingly the last period for which he/she should pay the unified tax, is the tax period, when the controlling authority received notice from the State Registrar about the state registration of the termination of business activity.
The Verkhovna Rada of Ukraine adopted the Law of Ukraine “On Amendments to the Tax Code of Ukraine to balance budget revenues in 2017” of 20.12.2016, № 1791, which introduced a number of amendments.
Corporate Income Tax
Since 2017 it is determined the uncollectible debt, which is overdue more than 360 days. As for individuals, it is considered that bad debts are those overdue more than 180 days and not exceeding 25% of the minimum wage.
PIT
Certain indicators that have binding to the minimum wage are twice reduced.
VAT
In 2017 it is renewed the right of controlling authorities to carry out a documentary audit of the payer on VAT reimbursement, if the calculation of the amount of budgetary compensation was made due to the negative value generated by transactions for periods prior to July 1, 2015, that are not documented inspections, and for purchase transactions to January 1, 2017 for goods and services in farms that use special VAT regime.
Simplified taxation system
From 2017 it is established the unified tax rate for taxpayers of 1st group as a percentage of the subsistence minimum for able-bodied persons established by the law on January 1 of the tax (reporting) year. For taxpayers of 2nd group it is left binding to the minimum wage.
Also, it is established the use of cash register for the unified tax payers that implement technically made household goods to the guaranteed repair service.
The Verkhovna Rada of Ukraine adopted the Law of Ukraine “On Amendments to Certain Laws of Ukraine on elimination of administrative barriers for export of services” of 03.11.2016, № 1724-VIII, which determined that the original document is not a confirmation of economic activities. Thus, the lack of primary documentation does not mean that there was not a transaction, if in fact there was flow of assets, liabilities and capital.
In addition, it is removed the reference to the date of the original documents. The place of execution of primary document is not the mandatory requisite. The analogue of a handwritten signature cannot be anymore on the primary document.
