The Cabinet of Ministers of Ukraine has approved the draft Law of Ukraine “On Amendments to the Tax Code of Ukraine on the introduction of electronic audit (e-audit)”.
The introduction of electronic audit (e-audit) will help solve the following tasks:
- improve risk-oriented approaches at the pre-verification and verification stages;
- increase the speed, accuracy and efficiency of audit results;
- create opportunities for taxpayers to self-check the submitted tax returns;
- reduce the number of tax requests to taxpayers;
- reduce the tax offenses and litigation;
- reduce personal contacts between the taxpayer and the controlling body, reduce the influence of the “human factor”.
In addition, a systematic analysis of the information transmitted from the taxpayer to the controlling authority will create additional opportunities to identify trends in the commitment of tax offenses in order to resolve them quickly.
The bill proposes to amend the Tax Code in terms of the obligation of taxpayers to submit to the State Tax Service exported from the original accounting system reliable data on the availability and condition of assets, equity and liabilities, as well as changes in the financial and economic condition of the taxpayer for reporting (tax) year in the form of a standard audit file (SAF-T) within 60 calendar days following the last calendar day of the reporting (tax) year.
The Cabinet of Ministers of Ukraine approved the draft Law “On Amendments to the Law of Ukraine “On Accounting and Financial Reporting in Ukraine”. The purpose of these changes is to improve the legal framework for accounting and financial reporting in accordance with the provisions of national and European legislation.
The draft law proposes:
- to introduce categories of groups of the parent company and its subsidiaries for the purposes of consolidation, presentation and disclosure of financial statements;
- to exempt small and medium-sized groups from compulsory preparation, submission and disclosure of consolidated financial statements in order to facilitate doing business;
- to improve certain rules for the submission of financial statements prepared in accordance with international financial reporting standards based on the taxonomy of financial statements in a single format;
- to supplement the list of enterprises that prepare financial statements in accordance with international financial reporting standards;
- to clarify the provisions on the disclosure of consolidated financial statements together with the audit report in order to ensure transparency and accessibility of information on the financial statements of enterprises;
- to improve the provisions on the requirements for primary documents in connection with the processing of documents using information and telecommunications systems.
The draft law proposes to establish that, depending on the nature of the business transaction and the technology of processing accounting information, additional details may be included in the primary documents.
In addition, the draft specifies that primary documents created automatically in electronic form by software of the information and communication system are used in accounting provided that the electronic signature or seal affixed to the electronic document in compliance with the legislation on electronic documents and electronic document management.
The adoption of the act will not only improve the legal framework for accounting and simplify doing business in this area, but will also promote transparency of financial reporting and a positive investment climate in Ukraine.
The State Labor Service of Ukraine has developed a draft resolution of the Cabinet of Ministers of Ukraine “On the introduction of special monitoring of repayment of wage arrears by enterprises, institutions and organizations”. It is planned to monitor the state of arrears of salaries, pensions and scholarships.
According to the project of the ministry, other central executive bodies, regional state administrations should ensure the work of temporary commissions on repayment of arrears of wages (cash), pensions, scholarships and other social benefits.
It is proposed to introduce special monitoring of repayment of wage arrears at enterprises, institutions and organizations.
The Ministry of Justice of Ukraine by Order No. 3201/5 of September 10, 2021 approved the Regulations on financial monitoring by the subjects of primary financial monitoring, state regulation and supervision of which is carried out by the Ministry of Justice of Ukraine (hereinafter – the Regulations).
A similar preliminary document, approved by Order of the Ministry of Justice No. 999/5 of June 18, 2015, was declared invalid.
The provision applies to:
- law firms, law associations and lawyers who practice law individually;
- notaries;
- business entities providing legal services, taking into account the specifics of the activities of such entities, if they participate, acting on behalf of the client, in any financial transaction and/or assist the client in planning or carrying out the transaction of:
- purchase and sale of real estate or property management during the financing of housing construction;
- purchase and sale of business entities and corporate rights;
- management of funds, securities or other assets of the client;
- opening and/or managing a bank account or securities account;
- raising funds needed to create legal entities and funds, ensure their activities or manage them;
- creation, provision of activities or management of legal entities, funds, trusts or other similar legal entities;
- persons who provide services for the establishment, operation or management of legal entities, if they, in particular, provide advice to the client, participate, acting on behalf of the client, in any financial transaction and/or help the client to plan or carry out a transaction to establish, operate or manage legal entities.
The responsibility for improper organization and conduct of primary financial monitoring is borne by the head of the entity, as well as the responsible employee of the entity.
The regulation came into force on September 25, 2021.
The National Bank of Ukraine is working on the introduction of an instant payment system in Ukraine.
Instant payment system is a system of electronic retail payments that are processed in real time 24 hours a day, 365 days a year, in which funds are instantly available for use by the recipient.
The main goal of creating an instant payment system in Ukraine is to enable users to make fast cheap transfers and payments from one payment account to another using convenient, modern and innovative access channels and methods of initiating payment transactions. The creation of an instant payment system will contribute to the development of the payment infrastructure, meet market and user expectations, financial inclusion and increase non-cash payments.
Key features of the instant payment system:
- work 24 hours a day, 365 days a year;
- cash flow occurs between user accounts;
- irrevocability of payments;
- instant availability of funds to the recipient for use (crediting the recipient’s account);
- instant notification of the recipient about crediting funds.
The State Tax Service of Ukraine on the official web portal published a draft order of the Ministry of Finance “On approval of Amendments to the Procedure for accounting of taxpayers and duties and Amendments to certain regulations of the Ministry of Finance of Ukraine” (hereinafter – the Draft).
The project is designed to bring into line with the laws of Ukraine:
- No. 1525-IX of June 3, 2021 “On Amendments to the Tax Code of Ukraine on Cancellation of Taxation of Income Received by Nonresidents in the Form of Payment for Production and/or Distribution of Advertising, and Improvement of VAT Taxation of Transactions on Supply of Electronic Services to Individuals by Nonresidents”,
- No. 1617-IX of July 1, 2021 “On Amendments to the Tax Code of Ukraine and Certain Other Legislative Acts of Ukraine Concerning the Administration of Taxes and Duties in the Temporarily Occupied Territory of the Autonomous Republic of Crimea and the City of Sevastopol”,
- No. 1618-IX of July 1, 2021 “On recognizing as invalid the Law of Ukraine “On the establishment of a free economic zone “Crimea” and on the peculiarities of economic activity in the temporarily occupied territory of Ukraine” and amendments to certain legislative acts of Ukraine”, Resolutions of the Verkhovna Rada of Ukraine No. 807-IX of July 17, 2020 “On formation and liquidation of districts”, as well as improvement of taxpayers’ accounting by controlling bodies.
The Verkhovna Rada of Ukraine adopted a law on the activities of the National Bank of Ukraine. The main purpose of the adopted law is to improve the internal governance and functioning of the central bank, in particular the procedure for interaction between the Council and the Board of the National Bank. The law also strengthens the requirements and imposes restrictions on individuals appointed to the positions of members of the Council, the Chairman and Deputy Governors of the National Bank. The provisions provided by law are fully in line with best corporate governance practices and global standards of governance in central banks.
In addition, the law is aimed at improving the efficiency of the gold and foreign exchange reserves management process. In particular, some terms and definitions were clarified and updated, unnecessary restrictions on the National Bank’s operations with international reserves were lifted, the potential range of NBU counterparties was expanded, and derivatives and repo transactions were standardized.
The law also regulates and updates certain issues that need to be adjusted in connection with the expansion of the functions of the National Bank in the regulation of non-banking financial services markets, in the field of currency regulation and supervision, as well as control and regulation of cash circulation.
At the same time, the Verkhovna Rada adopted two more related laws that will promote the comprehensive implementation of the Law of Ukraine “On Amendments to Certain Laws of Ukraine on Certain Issues of the National Bank of Ukraine” and create completed legal mechanisms for the implementation of the following laws:
- Law of Ukraine “On Amendments to Article 3 of the Law of Ukraine “On Public Procurement” on procurement of legal services by the National Bank of Ukraine” (project registration number 5852);
- Law of Ukraine “On Amendments to Article 33 of the Budget Code of Ukraine to Clarify the Information Submitted by the National Bank of Ukraine for the Preparation of the Budget Declaration” (project registration number 5853).
