The Cabinet of Ministers of Ukraine by its Resolution “On Amendments to the Procedure for Submitting Financial Statements” of 17.07.2019, No. 625, specified the procedure for submitting the financial statements.
In particular, the government adjusted the list of enterprises that submit the reduced annual financial statements in the balance sheet and the statement of financial results. These are enterprises that belong to:
- micro-enterprises;
- social businesses (except those obliged to prepare financial statements according to International Financial Reporting Standards; hereinafter – IFRS);
- enterprises that conduct a simplified accounting of incomes and expenses in accordance with the tax legislation.
It was also determined that financial reporting and consolidated financial statements in accordance with IFRS should be prepared by the entities operating in the extractive industries. Previously, it was about enterprises that carry out mining activities of national importance. Such clarification was made in accordance with the Law of Ukraine “On ensuring transparency in the extractive industries” of 18.09.2018, No. 2545-VIII.
The State Fiscal Service of Ukraine in its Individual Tax Advice “On Payment of the Unified Contribution to Compulsory State Social Insurance” of 19.07.2019, No. 3351/Г/99-99-13-02-03-14/ІПК reported that individuals, who were assigned a retirement pension in accordance with the Law of Ukraine “On Pension Provision” of 05.11.1991, No. 1788-XII, were not exempted from payment of the unified social contribution (hereinafter – USC) (Art. 4 of the Law of Ukraine “On the Collection and accounting for the Unified Contribution to the compulsory state social insurance” of 08.07.2010, No. 2464-VI; hereinafter – Law No. 2464).
That is, people who have been granted a long-service pension and who have not attained retirement age cannot benefit from the USC.
Only those people mentioned in paras. 4 and 51 of part 1 Art. 4 of the Law No. 2464 are exempted from payment of the USC. In particular:
- individuals – entrepreneurs, including those who have chosen a simplified taxation system;
- members of the farm, unless they belong to persons who are subject to insurance on other grounds.
Also, these people should comply with the requirements of part 4 of Art. 4 of the Law No. 2464. Namely: they receive a retirement pension or are persons with disabilities or have reached the age stipulated in Art. 26 of the Law of Ukraine “On Compulsory State Pension Insurance” of 09.07.2003 No. 1058-IV and receive a pension or social assistance in accordance with the law.
The State Fiscal Service of Ukraine, through the Office of Large Taxpayers, reminded: a campaign for declaration of the income tax for the second quarter of 2019 is in progress.
The quarterly declaration is submitted within 40 days after the end of the reporting period. Therefore, the last day of the submitting the income tax return for the second quarter is August 9, 2019, and the last day of payment, respectively, is on August 19, 2019.
The Office of Large Taxpayers drew attention to some of the nuances regarding the completeness and correctness of defining objects of taxation of the income tax, in particular, in the relations of payers with non-residents.
How to reflect the payment of the incomes to non-residents in the declaration
The first thing that non-residents need for the income payment is to determine the content of obligations for non-residents: identification of the place of delivery of services, taking into account their essence, availability of international treaties ratified by Ukraine, certificates and information on beneficiaries. This will enable to fully and in a timely manner identify the object of taxation of the income tax, the tax rate and reflect such indicators in the company income tax return for the sec. 23 of TI, sec. 24.
The procedure for the application of the international treaty of Ukraine on avoidance of double taxation with regard to the total or partial exemption from taxation of non-residents’ income with the source of their origin from Ukraine is stipulated in Art. 103 of the Tax Code of Ukraine (hereinafter – TCU).
The reason for the release (reduction) from the taxation of incomes with the source of their origin from Ukraine is the submission by the non-resident of a certificate (or a notarized copy thereof), confirming that the non-resident is a resident of the country with which an international treaty of Ukraine has been concluded (taking into account the specifics envisaged by paras.103.5 and 103.6 of this article, to a person (tax agent) who pays income to him/her), as well as other documents, if provided for by an international agreement of Ukraine (para. 103.4 of TCU).
The certificate is issued by the authorized agency of the respective country, defined by the international agreement of Ukraine, in the form approved in accordance with the legislation of the respective country, and should be duly legalized, translated in accordance with the legislation of Ukraine (para. 103.5 of the TCU).
If necessary, a person who pays income to a non-resident may apply to the controlling authority in his/her place of residence regarding the implementation by the central executive body implementing the state tax and customs policy, the request to the competent authority of the country with which an international treaty of Ukraine has been concluded, about the confirmation of the information indicated in the certificate (para. 103.6 of TCU).
Use of the certificate in electronic form for the purposes of Art. 103 TCU norms of this Code is not provided. In this regard, the certificate, received in electronic form, is not a ground for application of the international agreement on avoidance of double taxation.
The Office of Large Taxpayers noted the need to prepare a report on the amount of tax deductions for the income tax and the reflection of non-taxable income amount.
The Ministry of Social Policy of Ukraine in its letter “On the application of the provisions of the Law of Ukraine “On Leaves” of 06.26.2019, No. 751/0/204-19 reported that the legislation does not prohibit to provide secondary job employees with additional social leave.
Work on a part-time basis does not entail any restrictions on the extent of labor rights of employees (Art. 59 of the Labor Code).
An annual additional paid vacation for a period of 10 calendar days (not including holiday and non-working days) is provided to:
- a woman who works and has two or more children under the age of 15; or a child with a disability; or who has adopted a child;
- mother of a person with a disability from childhood of subgroup A of I group;
- lonely mother;
- a father of a child or a person with a disability from the childhood of subgroup A of I group who educates them without a mother (including, in case of prolonged stay of a mother in a hospital);
- to a person who has taken care of a child or a person with a disability from the childhood of the subgroup A and group, or one of the foster parents.
If there are several grounds for this leave, its total duration cannot exceed 17 calendar days. The relevant rules are defined in Art. 19 of the Law of Ukraine “On Laves” of 15.11.1996, No. 504/96- ВР. There are no restrictions for secondary job employees.
The State Labor Service of Ukraine reported on its official website whether it is possible to withdraw its dismissal letter.
The employment contract can be terminated, and the employee can be dismissed from work only on the grounds and in the manner prescribed by labor legislation. General grounds for the dismissal of employees are stipulated in Art. 36 of Labor Code.
According to the requirements of Art. 38 of the Labor Code, a worker has the right to terminate an employment contract concluded for an indefinite period of time, warning the owner or authorized body thereof in writing in two weeks. In case when the employee’s dismissal letter from work on his/her own will is conditioned by the inability to continue work (moving to a new place of residence; transferring a husband or wife to work in another locality; entering an educational institution; the impossibility of living in a certain area confirmed by a medical report; pregnancy; care for a child until it reaches the age of 14 or a child with a disability; care for a sick family member according to a medical report or person with disability of Group I; retirement; taking to the work on a competitive basis and for other valid reasons), the owner or authorized body should terminate the employment contract within the period requested by the employee.
If the employee, after the expiration of the notice of dismissal, has not left work and does not require termination of the employment contract, the owner or the authorized body thereof is not entitled to release him/her on the letter previously submitted, except in cases where another employee has been invited to his/her place, who cannot be refused to conclude an employment contract according to the law.
Dismissal at will is a termination of an employment contract on the initiative of the employee.
In para. 12 of the resolution of the Plenary Session of the Supreme Court of Ukraine “On the practice of consideration of labor disputes courts” of 06.11.1992, No. 9 it was clarified that in cases on the dismissal of workers from work on their own (according to Art. 38 of the Labor Code) courts should check the employee’s arguments that the owner or his/her authorized body compelled him/her to file an application for termination of the employment contract. At the same time, the submission by the employee of an application for the purpose of avoiding the responsibility for the guilty actions cannot be regarded as coercion and does not deprive the owner or the authority authorized by him/her of the right to release him/her for the guilty actions on the grounds stipulated by law, before the expiration of the established two-week period, and also apply to it during this period in the prescribed manner, another disciplinary penalty.
An employee who has warned the owner or person authorized by him/her to terminate an employment contract concluded for an indefinite period should have the right to withdraw his/her application before the expiration of the period of notice. Dismissing in this case is not carried out, if the person is not invited to his/her place in the order of transfer from another enterprise, institution, organization (Part 4 of Art. 24 of the Labor Code).
If after the expiration of the period of notice the employment contract has not been terminated and the employee does not insist on the dismissing, the employment contract is considered to be extended.
