Taxes
VAT
The State Tax Service of Ukraine has reminded that until January 1, 2015, the provisions of paragraph 200.4 of the Tax Code of Ukraine (hereinafter – the Tax Code) provided the possibility of budget VAT refunds in case of receipt of services from a non-resident in the customs territory of Ukraine. The amount of such refunds was equal to the amount of tax liability included in the tax return for the previous period for services received from a non-resident by the recipient of services.
However, in accordance with the Law of Ukraine “On Amendments to the Tax Code of Ukraine and Certain Legislative Acts of Ukraine Concerning Tax Reform” No. 71-VIII of December 28, 2014, this item was reworded, and for more than six years the law has not provided for budget reimbursement. in such circumstances in relation to a relationship with a non-resident who is not registered as a VAT payer.
However, according to the data of the submitted VAT tax returns, some taxpayers continue to apply rules that have long expired.
Therefore, in order to avoid negative consequences, the tax authorities emphasize: given the rules of paragraphs ‘b’ item 200.4 of the Tax Code, the taxpayer may not declare to the budget refund the amount of VAT accrued on transactions for services from a non-resident not registered as a VAT payer, the place of supply of which is located in the customs territory of Ukraine, as such amounts are not paid to the service provider or to the State Budget of Ukraine.
Accounting and Reporting
The Ministry of Finance of Ukraine by Order No. 408 of July 21, 2021 amended the Guidelines for the use of accounting registers.
The document contains a number of innovations.
1. Entities that prepare IFRS financial statements may apply Guidelines No. 356, provided that they do not conflict with IFRS.
2. Accounting registers can be compiled in paper or electronic form, but they must contain mandatory details.
3. Accounting registers (journals, information, tables of analytical data, transcripts, etc.) for all business transactions are filled in UAH and kopecks, and registers, which are also kept separately for transactions in foreign currencies – in the relevant measures of foreign currency.
4. Entities, taking into account the peculiarities of their activities and technology of accounting data processing, may additionally develop their own accounting registers, which must contain mandatory details, and approve them in the administrative document on the organization of accounting.
5. If changes are made to the Chart of Accounts and the Instruction on its application No. 291, the enterprise, if necessary, must adjust its accounting registers to such changes.
6. Approved new editions of such forms:
- journals from the 1st to the 7th;
- statement No. 8 off-balance sheet accounting;
- transcript sheet for debiting the account;
- accounting certificate to the Journal;
- general ledger;
- register of deposited wages.
Also, point changes and clarifications were made in the order of filling in the accounting registers.
Control and Responsibility
The President of Ukraine has signed Law “On Amendments to Section X “Final and Transitional Provisions” of the Law of Ukraine “On Public Procurement” to exclude the possibility of procurement without the use of electronic procurement system” No. 1599-ІХ, which was adopted by the Verkhovna Rada on July 1.
The Law changes for the period of quarantine established by the Cabinet of Ministers of Ukraine, the approach to the procurement of goods, works and services necessary for the implementation of measures to prevent the emergence and spread of COVID-19.
In particular, without the use of the public procurement procedure, medicines, vaccines or other medical immunobiological drugs, consumables for the provision of medical care to patients and medical devices for vaccination against COVID-19, medical equipment for health care facilities providing care to patients, patients with COVID-19, medical gas supply systems will be procured without the use of the public procurement procedure. The list of medicines and the procedure for their purchase will be approved by the Cabinet of Ministers.
Based on the results of the procurement, the customer must publish reports on the conclusion of the procurement contract and its implementation, as well as the procurement contract with all its annexes.
The necessary goods and services will be procured under the simplified public procurement procedure.
The Law enters into force on the day following its publication.
Financial Markets
The National Bank of Ukraine by Resolution “On Approval of amendments to the rules for determining payment signs and exchange of banknotes, small and circulation coins of the national currency of Ukraine” No. 55 of June 18, 2021 has amended the Rules for determining payment features and exchange of banknotes, small and circulation coins of the national currency of Ukraine.
First, it was clarified that banknotes intentionally damaged for the purpose of committing a criminal offense are non-payment banknotes that are composed/glued from non-payment parts from:
- various real banknotes;
- various genuine banknotes and parts of products similar in design to banknotes that do not imitate security features and/or strips of plain paper.
Second, non-payment banknotes (coins) include genuine banknotes (coins) that cannot be used for all types of payments, as well as for crediting to accounts, deposits, letters of credit and for transfers in connection with the acquisition in circulation or improper storage of signs of wear and damage that do not meet the criteria established by the NBU, as well as:
- banknotes intentionally damaged for the purpose of committing a criminal offense;
- banknotes (coins) withdrawn from circulation by the NBU;
- banknote samples;
- banknotes redeemed by stamps or inscriptions ‘before exchange’, ‘non-payment’;
- coins that have one or more of the following characteristics: mechanical damage (cut, holes, removed part, divided into parts), with completely absent images of the head and/or tail side.
Third, circulating coins may have one or more of the features that do not undoubtedly prevent the identification and denomination of the coin:
- darkening of the surface;
- minor mechanical damage (scratches, dents);
- point corrosion of the surface/design elements;
- pollution in the form of local spots, small dots.
Fourth, worn-out coins include coins that have one or more of the signs of damage that do not undoubtedly prevent the identification and denomination of the coin:
- bent or deformed in such a way that makes it impossible to machine count them;
- distorted and partially preserved images of the head and/or tail side due to prolonged stay in circulation, environmental influences and/or exposure to water/chemicals/fire (formation of corrosive shells, discoloration, melting).
Summary of Court Rulings
The Grand Chamber of the Supreme Court of Ukraine in its decision of June 8, 2021 in case No. 487/8206/18 (proceedings No. 14-164цс20) formulated an opinion on the correct application of the provisions of labor law, namely item 4 of Part 1 of Art. 40 of the Labor Code (dismissal of an employee for absenteeism) in combination with the provisions of Part 1. Art. 181 of this Code (the procedure for granting leave to care for a child), in the context of the obligation for the employee to wait for the order of the employer on such leave to be able to take advantage of this social guarantee.
It was stated that the right to leave without pay for childcare is considered exercised from the moment the employee submits a duly executed application with the relevant supporting documents, and therefore it is illegal to dismiss an employee who duly submitted such an application, that is, the employee informed the employer of his/her will to take childcare leave and therefore did not show up at work on the date specified.
The GC SC focused on the fact that Part 1 of Art. 181 of the Labor Code defines the procedure for granting these leaves, and not the rights and obligations of participants in labor relations in this process. To exercise the right to unpaid leave, the employee must confirm the fact of the child’s illness with a medical opinion, draw up their will in a written statement and notify the employer of such intention.
If this procedure is followed, the employee is considered to have exercised the state-guaranteed right to receive leave without pay. Personnel registration (issuance of the relevant order of the employer) of the submitted application for leave is not a legal fact, which is associated with the emergence of the employee’s right to leave.
Labor and Salaries
The State Labor Service of Ukraine has answered the following question: “If a woman hired for a new job has not used the right to social leave on two grounds: as a mother with two children under 15 and raising children herself. Does she have the right to take this leave at her new place of work, or should she have been paid compensation for unused leave?”
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, a mother of a disabled child from subgroup A group I, a single mother, a father of a child or a disabled child from subgroup A group I who raises them alone without mother (including in the case of long-term stay of the mother in a medical institution), as well as a person who takes care of a child or a disabled child from subgroup A group I, or one of the adoptive parents are granted annual paid leave of 10 calendar days excluding holidays and non-working days. If there are several grounds, the duration of additional leave may not exceed 17 calendar days.
This leave does not belong to the type of annual leave and is granted at any time during the calendar year, regardless of the time worked and the date of birth of the child. Leave is paid and is granted to a certain category of persons, in particular single mothers and fathers, guardians, women raising children with disabilities or adopting a child, etc., in order to properly combine their work activities with family responsibilities.
Such leave is mandatory at the request of the employee.
The legislation does not provide for a statute of limitations, after which the right to additional social leave for employees who have children is lost. Therefore, if for any reason the employee has not exercised this right and has not used this leave for the previous year or for several previous years, they are entitled to use this leave, and in case of dismissal, regardless of the grounds, they must be paid compensation for all unused vacation days according to Art. 24 of the Law “On Leave”.
In the event of dismissal of an employee who is entitled to such additional leave, the compensation for unused leave days is paid.
Thus, in case of dismissal from the previous place of work, the employer must pay compensation for unused leave.
The Other Things
The Ministry of Infrastructure of Ukraine has published a draft Law of Ukraine “On Amendments to Certain Laws of Ukraine on Fees for the Use of Public Roads” (hereinafter – the Draft).
The Draft provides:
- establishment of a fee for the use of public roads of state importance by vehicles with a gross weight of 12 tons or more, regardless of the country of registration of the vehicle;
- introduction of a system of control over the movement of vehicles using a device determining the direction and distance of the route of movement of the vehicle, and maintaining an electronic pay system for the use of roads;
- funds received for the collection of fees for the use of public roads of state importance and funds from sanctions for violation of the procedure for collection of such fees shall be sent to the state road fund;
- establishment of basic responsibilities for the implementation, maintenance and development of the system of fees for the use of public roads by vehicles, as well as access to it;
- ensuring proper control over compliance with the legislation on payment for the use of roads.
