The President of Ukraine signed the Law of Ukraine “On Amendments to the Law of Ukraine “On higher education” about the employment of graduates” of 06.10.16, № 1662-VIII, according to which institutions of higher education (hereinafter − IHE) had no obligation to employ graduates. Now they are free to choose the place of employment, except when otherwise specified in the law.
Applicants, having concluded an agreement on working in rural areas or towns for at least three years, have the right to priority enrolment in medical and educational institutions for public order. The state also provides housing with heating and lightning for them free of charge.
The Verkhovna Rada of Ukraine adopted the Law of Ukraine “On Amendments to Certain Laws of Ukraine on pension provision of certain categories of persons from among the participants of the antiterrorist operation” of 18.10.16, № 1683-VIII, according to which military personnel and commanding officers and other ranks of the internal affairs, who took part in anti-terrorist operations, would be granted the retirement pensions in advance – by five years earlier. In other words, when men are at age of 55 and women – 50. On condition that length of pensionable service is not less than 25 years for men and at least 20 years − for women.
The State Fiscal Service of Ukraine in its letter “On the accrual and payment of the income tax from accrued (paid) income at their own expense” of 28.12.16, № 28351/6/99-99-13-02-03-15 focused on one of the fundamental principles of taxation on income: a tax agent (e.g., an employer) that provided income to individuals should withhold tax at the expense of such income. So, if the tax agent decides to pay income tax at his/her own expense, rather than to withhold it from revenue, then the appropriate amount of money (amounting to non-withheld tax) would be taxable and additional benefit and should be taxed by the income tax on general grounds.
The State Fiscal Service of Ukraine in its letter “On compensation of fuel cost for an employee” of 05.01.17, № 104/6/99-99-13-02-03-15 reported that compensation for an employee of fuel cost which used during execution of labour requirements should be the subject to 18% of the income tax and 1.5% of the war tax as an additional benefit on the basis of sub-para. “г” of sub-para.164.2.17 of the Tax Code of Ukraine (hereinafter − TCU). The amount of compensation is not accrual basis of the unified contribution (para.11 of sec. I of List of payment types carried out at the expense of employers on which the unified contribution for obligatory state social insurance should not be accrued, approved by the Government of 22.12.10, № 1170).
The State Fiscal Service of Ukraine in its letter “On recognition of payment for the purchase of trade mark royalty” of 29.12.16, № 28477/6/99-99-15-02-02-15 reported: if the subject of intellectual property right (trade mark) to be transferred with transfer of ownership to it, while alienator loses the right to use and authorize or prohibit the use of the object of intellectual property third parties, then the payment for the transfer for tax purposes is not considered to be royalty (provided that confirmation of ownership rights to the object by corresponding certificate). In this case, payments for it are not taxed by the income tax of non-resident in accordance with sub-para. 141.4.2 of TCU.
The State Fiscal Service of Ukraine in its letter “On adjusting the financial result before tax in the amount of expenses for formation of provisions for compensation of payments of pensions under preferential terms” of 30.12.2016, № 28730/6/99-99-15-02-02-15 informed: compensation costs to the Pension Fund of Ukraine of payment of costs and delivery of pensions to persons who granted pensions under preferential terms to be belong to the payments related to wages.
Consequently, the financial result before tax when determining the subject to taxation of the company income tax should not be adjusted in accordance with sub-paras.139.1.1 and 139.1.2 of TCU on the amounts of expenses for formation and adjustment of provisions for compensation to the Pension Fund of Ukraine of the payment costs and delivery of preferential pensions and the amounts of actual payments at the expense of previously established provisions for such payments.
The State Fiscal Service of Ukraine in its letter “On accounting of the amounts of revaluation when accruing of amortization of fixed assets and non-current assets” of 28.12.2016, № 2649/2/99-99-15-02-02-10 notes: the subject to taxation of the income tax is the profit, which is determined by adjustment of the accounting financial result before tax on the differences determined by the provisions of the TCU.
The adjustment of the financial result before tax includes:
- increase of the financial result before tax in the amount of amortization of fixed assets (hereinafter − FA) or intangible assets (hereinafter – IA) accrued under Accounting Standards or IFRS (sec. 2 of para. 138.1 of TCU);
- decrease of the financial result before tax in the amount of calculated amortization of FA or IA according to para. 138.3 of TCU (sec. 2 of para. 138.2 of TCU).
The procedure of adjustment mentioned above involves accounting when the calculation of the income tax of the amounts of the depreciation of FA and IA calculated in accordance with the provisions of the TCU.
Also, adjusting of the financial result includes:
- increase of the financial result before tax in the amount of reduction and losses from usefulness decrease of FA and IA included in the expenses of the reporting period according to Accounting Standards or IFRS (sec. 3 of para. 138.1 of TCU);
- decrease of the financial result before tax in the increase amount and benefits from recovery of usefulness of FA and IA within previously attributed to expenses of reduction and losses from impairment of FA or IA conducted according to Accounting Standards or IFRS (sec. 4 of para. 138.2 of TCU).
This adjustment levels the impact on the calculation of the company income tax of results of revaluation (reduction, revaluation surplus) of FA or IA conducted under Accounting Standards or IFRS since such revaluation could be based on assumptions that take into account subjective judgments and do not reflect the real value of fixed assets.
Thus, the result of revaluation of FA or IA conducted under the provisions of Accounting Standards or IFRS are not included in the calculation of amortization of intangible assets in accordance with Art.138 of TCU and when the calculation of the company income tax.
The Ministry of Social Policy of Ukraine provided clarification of certain issues of payment for labour in compliance with the Law of Ukraine “On amendments to Certain Legislative acts of Ukraine” of 06.12.2016, № 1774-VIII. The main provisions are in the following.
- When the calculation of the salary of the employee for its minimal size it should not be taken into account additional payment for work in unfavorable working conditions and increased health, risks for night work and overtime, traveling nature of work, bonuses for holidays and anniversaries.
- In the case when there were established additional payments for work in hazardous working conditions, they should be paid over than the minimum wage (UAH 3 200).
- If the conditions of payment for labour provided for increasing in official salaries, for example, for work in institutions and organizations located in the populated areas that have the mountain status, for work in certain types of institutions, for work in hazardous and difficult working conditions, so the specified increasing should be taken into account of the minimum wage.
- If the employee performed monthly norm of labour and the accrued salary is lower than the legally established minimum wage, the employer is also obligated to make additional payment to its rate, which is payable monthly simultaneously with salary.
- If the employee did not perform monthly labour rate, he/she was on vacation, on sick leave, works part-time, etc., and the payment for his/her work to be conducted in proportion to the performed work rate.
- The idle hour through no fault of the employee should be paid according to the standards of Art. 113 of the Labor Code not lower than 2/3 of the tariff rate (salary) established for the employee without making additional payments to the minimum wage rate.
- When implementation of summarized account of working hours with accounting month period, the work in excess of normal working hours for the accounting period should be paid as overtime and the specified payment should be over the minimum wage.
In case if work when summarized accounting of working hours to be done within the established working hours for the employee, which to be less than the normal hours, according to schedule of work, the salary for the employee should be accrued in the amount not less than the minimum wage.
It is recommended to use accounting periods as half-year period, a year for companies for which it is established the summarized accounting of working hours in order to reduce overtime work hours and impacts on the wages fund.
The Social Insurance Fund for Temporary Disability (hereinafter – SIF for TD, Fund) in its letter “On correction of errors in the report in the form F4-SIF for TD” of 21.11.16, № 2.4-16-2037 reported: if in case of excessive accrual of sick pay, the insurer informed the authority of the Fund on the error detection and transferred sums of unduly accrued expenses prior to the inspection, the penalties should not be applied for the insured.
In addition, experts of the Fund explained the procedure for correction of errors in the report in the form F4-SIF for TD in case if the insurer adjusted (reduced) costs of the Fund and transferred means excessively received in full volume during the reporting period to the Fund. In this case, in Table I of the specified report in line 14 it should be noted the amount of means transferred to the Fund; in line 21− adjusted amount of costs at the expense of Fund (also it should be adjusted the corresponding lines of Table II). In line 6 of Table I it should be remained the amount of funds received from the Fund. In this case, the figures of lines 9 and 22 of Table I are to be matched together, and lines 10 and 23 – are not to be filled in.
The Supreme Court of Ukraine in its decision of 14.12.2016, № 6-788цс16 formed legal position under which in accordance with content of Art.117 of the Labour Code (hereinafter − the Labour Code) in case of non-payment of sums owned by dismissed employee due to the fault of the owner or his/her authorized body within the deadline specified in Art. 116 of the Labour Code, in the absence of dispute about their size, the company should pay to the employee his/her average salary for all the delays on the day of actual payment. If there is dispute about the size of sums owned by the dismissed workers, the owner or his/her authorized body should pay specified compensation in case if the dispute resolved in favour of the employee.
Analysis of the given norms of substantive law gives reason to believe that non-payment to the employee of all sums owned by the dismissed worker from the owner or his/her authorized body is a continuing offense and therefore the worker can determine the final amount of his/her claims at the date of termination of such offence, which is the actual day of calculation.
