Virtually every business entity is created to profit and multiply its founders' wealth. At the same time, there is a small cohort of organizations whose purpose is not to generate profits, but to meet public needs, namely, serving the needs of others, and almost always without seeking to profit. This is a so-called non-profit organization. Let's talk about the specifics of reporting by non-profit organizations.
It should be recalled that the non-profit are the enterprises, institutions and organizations (hereinafter – non-profit organization), which at the same time meet the requirements set out in item 133.4 of Art. 133 of the Tax Code of Ukraine (hereinafter – Tax Code), and are entered by the controlling body in the Register of non-profit institutions and organizations (hereinafter – the Register).
Non-profit organizations submit to the bodies of the State Tax Service a Report on the use of income (profits) by non-profit organization (hereinafter – the Report) according to the form approved by order of the Ministry of Finance of Ukraine No. 553 of June 17, 2016 (in the version of order of the Ministry of Finance of Ukraine No. 469 of April 28, 2017) and annual financial statements.
Lines 7 and 8 of the introductory part of the Report provide the date and number of the last decision of the supervisory authority to include (re-include) the non-profit organization in the Register and to assign or change non-profit organization's feature.
The financial statement, prepared and submitted by non-profit organizations, is an annex to the Report and an integral part of it.
Confirmation of the submission of the financial statement together with the Report is marked “+” in the Report in the box “FS” of the table “Annexes” and in the table “Submitted anneals – forms of financial statements to the Report on the use of income (profits) by non-profit organization”.
Non-profit organizations that withhold and contribute to the budget a tax on the income of non-residents, together with the Report, must submit a corporate income tax return, the form of which was approved by Order of Ministry of Finance of Ukraine No. 897 of October 20, 2015, with line 23 of the Annex of the tax invoice to such a declaration.
As a prerequisite for the non-profit organization is the use of its income (profits) solely for the financing of expenses for its maintenance, for the realization of the purpose (goals, tasks) and directions of activity determined by the constituent documents, in case of non-compliance with these requirements such non-profit organization is obliged to file within the period specified for the monthly tax (reporting) period, the Report for the period from the beginning of the year (or from the beginning of recognition of the non-profit organization in due course, if such recognition was made later) till the last day of the month in which the violation was committed, and indicate and pay the amount of the self-assessed income tax liability. The tax liability is calculated based on the amount of the misuse of assets.
In addition, such a non-profit organization is excluded by the controlling authority from the Register and considered as a payer of income tax for tax purposes from the first day of the month following the month in which such violation was committed.
