A company engaged in the production of agricultural products and is the payer of the unified tax of group IV, decided to change the taxation system to general one.
Consequences of this decision for the payer are in the following
It should be recalled first of all that the group IV of the unified tax can be applied only by legal entities - agricultural producers, which share of agricultural production in the previous tax (reporting) year is equal to or exceeds 75% and which own or lease farmland and/or land plots of the water fund (sub-para. 4 of para. 2911.4 of Art.2921 of the Tax Code of Ukraine, hereinafter - TCU).
A simplified taxation system attracts agricultural producers by exempting them from paying such taxes and fees (para.297.1 of TCU):
- company income tax
- land tax for land plots used for agricultural commodity production;
- rent for special use of water.
At the same time, the increase in tax pressure makes them think over whether it is expedient to be the payer of group IV of the unified tax. As practice shows, cases of transition to the general system become more frequent.
What are important issues for these taxpayers in the event of the choice of a general system of taxation?
Firstly, the tax differences set in para. 140.5.12 of TCU, they are not used in any way. It should be recalled that according to this norm, the company that shipped the goods (provided services, performed work) on a simplified system, and received payment for them on the total, should increase the financial result to the amount of income for such a transaction, subject to the decision on the application of the difference or if the accounting income for the past year exceeded UAH 20 million. However, the provisions of sub-para.140.5.12 of TCU do not apply to taxpayers who were the unified tax payers of group IV.
Secondly, they retain the right to receive a budget subsidy. Taking into account the requirements of the Law of Ukraine “On State Support to Agriculture of Ukraine” of 24.06.2004, No. 1877-IV (hereinafter - Law No. 1877), an agricultural company must meet the following criteria for obtaining the right to receive a budget subsidy:
- main activity - supply of agricultural products made by them on own or leased fixed assets;
- specific weight of the value of agricultural goods is not less than 75% of the value of all goods delivered by them during the previous 12 consecutive reporting periods in aggregate;
- activities carried out by the agricultural company should be on the list referred in paragraph 161.3 of the Law No. 1877.
At the same time, the mentioned above Law does not contain restrictions on the presence of legal entities on a simplified or general system of taxation. Consequently, in order to retrain the right to receive a budget subsidy for agricultural producers, it is enough to meet the mentioned above selection criteria.
