Taxes
VAT
The compulsory registration by the VAT payer is only for the business entities now, whose volume of supply of goods / services for the last 12 calendar months cumulatively exceeded UAH 1 000 000 (previously it was about UAH 300 000).
The regulations of VAT assessment base are adjusted, they are approved under p.188.1 of the TCU. Thus, since 01.01.15 the tax assessment base of the transactions of supply of goods (works / services) should be determined on the basis of agreed cost, but not lower than (Art.188 of TCU):
- regular prices (in controlled transactions);
- acquisition prices of goods / services;
- the cost of self-produced goods / services;
- the balance (residual) cost of noncurrent assets according to the accounting, established at the beginning of the accounting period when there was the supply of noncurrent asset (if the accounting for the noncurrent assets was not maintained - not less than the regular price).
The above mentioned regulations of accrual base of VAT liabilities are not applied to the goods (services) supply, which prices are the subject to the state regulation.
Despite some conflicts of the TCU rules, in our opinion, since 01.01.15 all the tax invoices should be issued electronically and registered in the Unified Register of Tax Invoices (URTI) irrespective of the amount. There are 15 days for the registration in URTI as before.
The test mode is provided for the electronic VAT administration system from 1 February to 1 July 2015 (p.p. 33-37 subdivision 2 d. XX of TCU). Although the amendments are possible to be made again in the TCU in January.
Since 01.01.15 the Tax credit could be reflected in the period when the Tax Invoice was registered in URTI, but not later than:
- 180 calendar days from its making date;
- 60 calendar days from the date of the debit transfers from the bank account – for the VAT payers who use the cash method.
The State Fiscal Service of Ukraine in its letter of 19.01.2015, № 1403/7/99-99-19-03-01-17 answered the question about the date starting with which all the tax invoices were to be the subjects to the registration in the Unified Registry of Tax Invoices (URTI) and should be made only in the electronic form.
The Tax Invoices prepared by the taxpayers in January 2015 and which VAT amount is less than UAH 10 thousand (including those which are not available to the buyer, issued on the supply of goods/services which are exempt from taxation), can be registered in the Unified Register of Tax Invoices at the request of the taxpayer.
From February 1, 2015 all the tax invoices and adjustment calculations to them (including those which are not available to the buyer, issued on the supply of goods/services which are exempt from taxation), regardless of the VAT size in one tax invoice / adjustment calculations are the subject to the registration in the Unified Register of Tax Invoices.
From 1 January 2015 the taxpayers are given the opportunity to correct errors in tax invoices by making the adjustment calculations to them.
In the system of the electronic VAT administration from 01.02.2015 the adjustment calculations to the tax invoice issued to the recipient - taxpayer is the subject to registration in URTI:
1) by the supplier of goods / services, if the intention is to increase the compensation amount of their value to the advantage of this supplier (seller) or if the adjustment of the quantitative and cost indices as the result does not change the compensation amount;
2) by the recipient of goods / services, if the intention is to decrease the compensation amount of the value of goods / services to the supplier (seller), for which the supplier (seller) sends the drafted adjustment calculations to the recipient (buyer).
The registration of the adjustment calculations from 1 January to 1 February 2015 is going to be carried out by the supplier (seller) of goods / services.
In January 2015 the adjustment calculations are to be registered only by the suppliers.
The registration period of the tax invoices / adjustment calculations in the URTI has not been changed and is 15 calendar days.
The State Fiscal Service of Ukraine in its letter of 19.01.2015, № 1403/7/99-99-19-03-01-17 reminded that the regime of exemption from VAT transactions for the supply of waste and ferrous and non-ferrous scrap metal as well as paper and cardboard for the utilization (waste paper and scrap) is extended to 1 January 2017 within the tax reform.
However, the Tax Code of Ukraine determined that the lists of such waste and ferrous and non-ferrous scrap metal should be approved by the Cabinet of Ministers of Ukraine. The Government Regulation of 05.02.2014, № 43 “On Amendments to the Resolution of the Cabinet of Ministers of Ukraine dated 12 January 2011 № 15” was valid till 1 January 2015.
Thus, the SFSU experts come to the traditional decision: before the approval of the new lists of waste and ferrous and non-ferrous scrap metal by the Cabinet or before the renewal of the previous, the taxation of the transactions for the supply of such waste is carried out at 20% rate.
The State Fiscal Service of Ukraine in its letter of 19.01.2015, № 1403/7/99-99-19-03-01-17 reported that the adjustment calculations were registered only by the suppliers in January 2015.
From 1 January 2015 the taxpayers were given the opportunity of the correction of errors in the tax invoices by making the adjustment calculations to them.
Within the electronic VAT administration system from 01.02.2015 the adjustment calculation to the tax invoice, issued to the recipient – taxpayer, is the subject to the registration in SRTI:
1) by the supplier of goods / services, if it is intended to increase the compensation amount of their value in favor of the supplier (seller) or if the adjustment of the quantitative and cost indexes does not change the compensation amount as the result;
2) by the recipient of the goods / services, if it is intended to decrease the compensation amount of the value of goods / services to the supplier (seller), for which the supplier (seller) sends the prepared adjustment calculation to the recipient (buyer).
The registration of the adjustment calculations would be conducted from 1 January to 1 February 2015 by the supplier (seller) of goods / services.
The State Fiscal Service of Ukraine in its letter of 19.01.2015, № 1403/7/99-99-19-03-01-17 reminded that the VAT payment to the budget for December 2014 and January 2015 / IV quarter of 2014 would be conducted by the taxpayer from his/her current account directly to the budget accounts, and since February 2015 / I quarter of 2015, - from the account in the system of electronic VAT administration.
I.e., the VAT liabilities for February 2015 would be transferred from the account in the system of electronic VAT administration according to the register formed by the SFSU. The taxmen should send such register to the Treasury no later than three working days until the end of deadline for the independent payment of tax liabilities.
The income tax
Probably everybody heard about the news that the object of taxation on the income tax was determined according to the accounting rules with following difference adjustment, provided for in the TCU. Among other things the differences occur when the calculating depreciation of the current assets should be taken into consideration (Art.138 TCU), also the formation of reserves (provisions) (Art. 139 of TCU), financial transactions (Art. 140 of TCU), and the differences on sales transactions or other disposal of securities as well as transactions with investment property and biological assets, which are valued at the fair value (p. 141.2 of TCU).
There is a lot of time to implement the new rules of the tax accounting on income tax. There is because most of the people who have profit should submit the annual accounts on income tax. And under the new rules the Declaration for 2015 should be submitted up to 01.06.16.
The State Fiscal Service of Ukraine approved the Generalized tax consultation on certain issues of the reflection of securities transaction in the tax accounting for corporate income tax by the Order of 26.12.2014, № 400. It answers a number of questions which the payers unavoidable meet in drafting of the tax declaration for 2014.
The State Fiscal Service of Ukraine by the Order of 17.01.2015, № 13 approved the Methodological recommendations regarding the special aspects to clarify the tax liabilities on the company income tax and VAT in the case of tax compromise.
Thus, the tax compromise procedure extends to:
1) the voluntary declaring of understated tax liabilities for VAT and income tax in the relevant tax reporting periods before 1 April 2014;
2) the voluntary declaring of understated tax liabilities in the case when the taxpayer has the started documentary inspection or the act by its result, regardless of the tax compromise procedures by the decision of supervisory authority;
3) the cases when the taxpayer received a tax notification decision whereby the tax liabilities for company income tax and/or VAT are not agreed;
4) the inconsistent amounts of the tax liabilities for company income tax and/or VAT, indicated in the tax notification decisions, regarding which the procedure of administrative appeal is continued;
5) the agreed amounts of tax liabilities for company income tax and/or VAT, indicated in the tax notification decisions, regarding which the procedure of judicial appeal is continued.
The tax liabilities in accordance with the procedure of the tax compromise are paid in the budget amounting to 5% of the understated tax liabilities amount. The remaining 95% are considered to be canceled by the results of achieving the tax compromise. In this case, the penal sanctions are not applied to the taxpayer, and the fine is not charged respectively.
By reaching a compromise is meant the payment of amounts of tax liabilities for VAT and / or income tax in the budget by the taxpayer.
Reaching the compromise excludes the necessity of the drafting of the protocol on the administrative offence, if it has not been drafted, and also gives grounds to the court to exempt the payer from the administrative liability.
The methodological recommendations do not establish the new norms of law, and only recommend and explain the uniform understanding of the procedures for the tax compromise application.
Let us recall, the Law on tax compromise entered into force on 17 January 2015.
USC
Despite the announced reduction of USC rate (including rate of 0.4 can be applied to the base rate for the company), not all will actually take advantage of the right of such minimization. There are stringent requirements in the norm for those who want to take advantage of the USC rate reduction, in particular, there is a requirement of increasing of the tax base of USC in 2.5 times compared to the previous year.
In addition, if the accrual base of USC (excluding fees for civil law contract) does not exceed the minimum wage for the corresponding month, the accrual of USC should be calculated from the amount of the minimum wage (the latest is UAH 1218 in January - November 2015).
The tax on profits
The parliamentarians raised the individual income tax rate to 20% (previously 17%), the rate should be applied to the incomes amount that exceeded UAH 12 180.
In addition, all passive incomes (excluding dividend incomes on shares and profit participation rights, accrued by residents-income tax payers) are the subject to the individual income tax at the 20 % rate now.
The State Fiscal Service of Ukraine in its letter of 21.01.2015, № 1665/7/99-99-17-02-01-17 explained the innovations of taxation of winnings, prizes in 2015.
The PIT rate is the double size of the base rate (15%) regarding the incomes, accrued as winning or prize (excluding winnings, lottery prizes) in favor of residents or non-residents.
That is, the tax rate of 30% applies to incomes that are accrued by the tax agent in the form of prizes or winnings (excluding winnings, lottery prizes).
As an exception the cash prizes in sporting competitions are taxed at a rate of 15%. The above-mentioned does not concern the rewards to the sportsmen - champions of Ukraine, the winners of sports competitions of international level, including disabled sportspeople.
The tax agent, when the charging (payment, provision) of the income in the form of winnings (prizes) in a lottery or other drawings, in sports betting, in totalizator betting, prizes and winnings in cash received for winning and / or participation in amateur sports competitions, including billiard sports, is a person who performs such charging (payment).
The total amount of tax charged at the rate of 15% of the total amount of winnings (prizes) paid for the tax (reporting) month to the lottery players is paid (transferred) to the budget by the tax agent - operator of the lottery within the established deadlines for the month tax period.
The tax agents - operators of the lottery in the tax calculation on f. № 1ДФ reflect the total amount charged (paid) in the tax reporting period of incomes in the form of winnings (prizes) and the total amount of tax withheld from them. The information about the amounts of an individual winning, the amounts of charged tax on them, as well as the information about an individual – taxpayer who has received the income in the form of a winning (prize) are not specified in the tax calculation on f. № 1ДФ.
Winnings or prizes (excluding winnings, lottery prizes) in favor of residents or non-residents are reflected in the tax calculation on f. № 1ДФ under the sign of income “111”.
The amount of money received as winning, a prize in a lottery on the grounds of “166” is reflected in the calculation of f. № 1ДФ to 31.12.2014.
The single tax
There are only four groups of the Single tax payers since 01.01.15.
Only individual-entrepreneurs may choose I and II groups, and all the business entities that meet the work conditions at the ST may choose III group. But only legal entities - agricultural producers with agricultural share of 75% or more for the previous tax (reporting) year can work in the IV group.
In addition, the legislative officers increased the limit of income size of the single tax payers. Thus, it is UAH 300 thousand for the I group, for the II – UAH 1.5 million, and the third – UAH 20 million.
The ST rates are also corrected: I group to 10% of the minimum wage as of January 1, II group – to 20% of the minimum wage, III group – 2% of the income of the ST payer that is registered as VAT payer, and 4% - of the income of the single tax payer, who does not pay the VAT.
Other taxes and fees
The State Fiscal Service of Ukraine in its letter of 20.01.2015, № 1519/7/99-99-19-03-03-17 reminded that the tax base of the transactions for the supply of goods /services with the VAT included the national taxes and duties (incl. excise tax), and tax base for the excise tax from the retail sale of excise goods was the cost (with VAT) of excise goods.
According to the SFSU, the calculation of the retail excise duty on tobacco products should be carried out as follows.
The VAT payers:
ARPTP = (RPTP: 100 х 120): 100 х 105, where
ARPTP – the actual retail price at which the tobacco products are sold;
RPTP – the retail price of tobacco products excluding VAT.
The amount of the tax liability from the retail excise duty is:
TLe = ARPTP : 105 х 5.
The amount of the tax liabilities on VAT is:
TLvat = (ARPTP – Tle) : 120 х 20.
The non-payers of the VAT:
ARPTP = RPTP: 100 х 105.
The amount of the tax liability from the retail excise duty is:
TLe = ARPTP : 105 х 5.
Thus, ARPTP for both cases could not exceed the maximum retail price, which is calculated by the formula:
MRPTP = MPP : 100 х 105.
Please note that the SFSU in its another clarification believes that the sale of tobacco products in retail network of 01.01.2015 is carried out at the prices not exceeding the MPP (minimum permissible prices) established by the manufacturers or importers of goods increased by the amount of excise tax from the retail sale of excise goods. That is, the excise tax from retail trading of excise goods - 5% is added to the MPP (100%).
The cost of tobacco products, their realization is not permitted above this cost, can be obtained multiplying the MPP (indicated on the package) by 1.05.
Temporarily occupied territories
The State Statistics Service of Ukraine by the Order of 18.12.2014, № 396 made the amendments to the Classification of countries of the world, having complemented it by the Annex with the position of “Free economic Zone “Crimea””.
FEZ “Crimea” is entered within two administrative-territorial units of Ukraine: Autonomous Republic of Crimea and Sevastopol city.
The administrative border between the territory of FEZ “Crimea” and the rest territory of Ukraine coincides with the land administrative border between Autonomous Republic of Crimea and Kherson region.
Let us recall, that the Classification of countries of the world is approved by the Order of the State Statistics Service dated 30.12.2013, and is used to account and share the information on foreign trade statistics, in the banking and financial spheres, in transportation of export-import cargoes and in other cases when it is necessary to use the code form of symbols of the countries of the world.
The Order is valid from 1 January 2015.
Control and responsibility
The Verkhovna Rada of Ukraine amended the article 265 of the Labor Code by the Law of Ukraine “On Amendments to certain legislative acts of Ukraine concerning the reform of compulsory state social insurance and the legalization of wage fund” of 12.28.2014, № 77-VIII, which entered into force on 1 January 2015. Now, the employer can be brought not only to administrative, but also to the financial responsibility for violation of the labor legislation.
In particular, the employers for the actual permit of the employee to work without the employment agreement (contract) are liable in the form of a fine of 30 minimum wages established by the law at the time of violation. This fine was established per each employee against whom the violation was committed. In 2015 such penalty will be UAH 36 540, and starting from December – UAH 41 340.
It should be noted that the administrative responsibility is also provided for such type of the violation. And there are not small penalties here – from 510 to 1 700 UAH, in the case of repeated violation - from 1 700 to 5 100 UAH.
Labour and salaries
The Temporary Disability Social Insurance Fund in its letter of 17.01.2015, № 2.4-17-92 clarified the nuances of the payments appointment when the insured events occured.
On the insured events that occurred before 31.12.2014 inclusive, in determining the right to financial security and its size it should be governed by the norms of the Law “On Compulsory State social insurance due to temporary disability and expenses provided for burial № 2240”. The norms of the Law of Ukraine “On Compulsory State Social Insurance” of 23.09.1999, № 1105 are applied to the insurance events occurred since 01.01.2015.
According to the amendments entered into force on 1 January 2015, the insured persons who during the twelve months before the insured event according to the State Register of social insurance have had the insurance period at least six months are entitled to maintenance in the following amounts:
1) temporary disability benefit - on the basis of gross wages and salaries, from which the insurance contributions are paid, but per month not more than the minimum wage established by the law, occurrence of the insured event in the month;
2) maternity grant - on the basis of gross wages and salaries, from which the insurance contributions are paid, but per month not more than the double minimum wage and not less than the minimum wage established by law, occurrence of the insured event in the month.
The insurance period in the specified case is determined according to the personal record-keeping data on the insured persons. The insurer should do such calculation on the basis of the data of the State Register of the social insurance, provided by the insured person in the form of certificate of the Pension Fund of Ukraine.
Accounting and reporting
The Ministry of Finance of Ukraine by the Order “On Amendments to the Regulations on the documentary providing of the records in the accounting and recognition of those that have lost the power, the Ministry of Finance of Ukraine orders of 16 May 1996 № 99 and dated 24 March 2000 № 61 of 30.09.2014 № 987” repealed the Instruction on the registration procedure of issued, returned and used power of attorneys for the receipt of valuables. The Order came into force on 1 January 2015.
Therefore, from January 1, 2015 the power of attorney is unrequired when receiving the valuables.
The regulations on the documentary providing of the records in the accounting are amended by this Order adding the following paragraph: the authority to implement the business transaction of the person, who for the benefit of legal entity or individual entrepreneur gets the fixed assets, holdings, intangible assets, monetary instruments, securities and other commodities and materials, under the agreement, are to be confirmed in accordance with the legislation. In particular, such authority can be confirmed by the written contract, the power of attorney, an act of the legal entity etc.
Thus, from January 1, 2015 the procedure for the receipt of valuables entirely depends on the agreement between the seller and the buyer. Certainly, such an agreement should be determined by the terms of the contract. In this case, the power of attorney can be used in arbitrary form taking into account the norms of Art. 245 – 250 of the CCU ст. 245 – 250 ГКУ.
The Ministry of Finance of Ukraine amended the Procedure for financial and budgetary reporting by the administrators and recipients of budgetary funds by the Order “On Amendments to the Order of the Ministry of Finance of Ukraine on January 24, 2012 № 44” of 12.17.2014, № 1207. In particular, the issue regarding the reporting by the administrators and recipients from the ATO area and the occupied territory is settled.
Thus, in case of failure to provide the financial and budgetary reporting at the balance sheet date by those administrators and recipients of budgetary funds who are in the Crimea and the ATO area, the reporting data of such administrators and recipients of budgetary funds, which have been filed by them in the previous reporting period, are included the consolidated financial and budgetary reporting.
The chief administrators of budgetary funds in the consolidated annual financial and budgetary reporting separately submit the consolidated financial and budgetary reporting of the administrators and recipients of budgetary funds, who are in the temporarily occupied territory.
Also, the form № 4-5d “The report on receipt and use of other revenues of the special fund (Financial Treasury Bills)” and any information about the financial treasury bills as well as “The certificate of financial treasury bills” (annex 36) are excluded from the text of the Procedure.
In addition, the following forms of the documents are set in the new version:
annex 1 BALANCE (form № 1);
annex 19 “The certificate of the tangible assets that are transferred in safe custody”;
annex 28 “The certificate of causes of occurrence of the overdue debtor indebtedness of the General Fund and measures taken for its recovery”;
annex 29 “The certificate of causes of occurrence of the overdue accounts payable of the General Fund”;
annex 33 “The certificate of debtor indebtedness on the expenditure side”;
annex 36 “The comparison of the indicators forms of financial and budgetary reporting”.
The Ministry of Finance of Ukraine by the Order № 11 of 23.01.2015 approved a number of methodological recommendations for the public sector entities regarding the accounting policy as well as the accounting records of certain assets, as follows: fixed assets, intangible assets and inventories.
Let us recall, the specified methodological recommendations are approved due to the implementation in 2015 of the National Statement of Standard Accounting Practice for the public sector, and also in order to implement the Strategy of modernization of the accounting system in the public sector for 2007 - 2015.
Financial Markets
The National Bank of Ukraine in its letter of 27.01.2015, № 25-110/4833 reported that temporarily, until 1 July 2015, in cases and under the conditions determined by law, the funds recovery from the taxpayers’ bank accounts was carried out by the decision of the head of the supervisory authority without recourse to legal proceedings.
The relevant norm is provided by the Law “On Amendments to the Tax Code of Ukraine and certain legislative acts of Ukraine concerning the tax reform” of 28.12.2014, № 71-VIII.
In order to implement the specified requirements until 1 July 2015, the banks accept and perform the collection orders (instructions) for the tax debt collection, completed according to the decision of the head of the SFSU. The date of issuance and number of the decision of the head of the SFSU should be specified in the requisite details “Details of payment” of such collection order (instruction). The very decision, on the basis of which the collection order (instruction) is executed, should not be applied to the bank.
The regulator prepared the project of the appropriate amendments to the Regulations on noncash transactions in Ukraine in the national currency. This project of amendments will be published on the NBU site in the nearest future.
The State Statistics Service of Ukraine by the Order “On approval of the Classification of the currencies” of 31.12.2014, № 416 approved the new currencies classification.
The document is developed to provide the accounting, processing and dissemination of data of foreign trade statistics and investment in any trade, banking and financial sectors, as well as the information from the Single State Register of the Enterprises and Organizations of Ukraine with the using of the international code to identify currencies.
The order is valid from 1 January 2015.
Securities Market
The Verkhovna Rada of Ukraine adopted the Law of Ukraine “On Amendments to the Article 41 of the Law of Ukraine “On Joint Stock Companies” regarding the quorum of the general meetings of joint stock companies with majority state corporate rights” of 13.01.2015, № 91-VIII.
The law establishes the quorum for decision-making at the general meeting of the joint stock company 50% plus 1 share (instead of 60% plus 1 share). The document will come into force from the date of publication for the state companies, and from 1 January 2016 - for the others.
These changes are intended to combat the deliberate blocking of general meetings, what led to the bankruptcy, raiding, violation of the shareholders rights.
Other things
The Ministry of Regional Construction of Ukraine in its letter of 15.01.2015 clarified that the transfer of the equipment, purchased by the contracting agency on the customer instructions, was carried out under the contractor agreement.
The cost of equipment, furniture, inventory purchased and established or installed by the contractor should be included in the certificate of the cost of executed construction works and expenses (form № КБ-3) in the reporting period. The cost of such equipment is confirmed by payment orders, issued on the basis of the supplier-plant bill, and calculations of ordering costs.
Installed equipment is transferred to the balance of the customer when the acceptance of completed construction projects.
The preparation of the acceptance procedure of manufactured equipment, the acceptance and transfer of the equipment in the installation of the contracting agency, the identifying of the equipment defects are carried out according to the following standard forms:
The Act of acceptance of the equipment (standard form № M-15);
The Act of the acceptance and transfer of the equipment in the installation (standard form № M-15a);
The Act of the identified equipment defects (standard form № M-17).
