The Law of Ukraine “On Amendments to the Tax Code of Ukraine to Improve Tax Administration, Eliminate Technical and Logical Inconsistencies in Tax Legislation” No. 466-IX of January 16, 2020 (hereinafter – Law No. 466) slightly addressed some issues related to tax credit, value added tax refund (hereinafter – VAT) and the VAT electronic administration system (hereinafter – VAT EAS). More details below.
Tax Credit
As specified in item 198.6 of the Tax Code of Ukraine (hereinafter – Tax Code) the tax credit cannot include the amounts of VAT paid, if they are not tax invoices or adjustment calculations to them, customs declarations confirmed or registered in the Unified register of tax invoices and adjustment calculations (URTI), or other documents specified in item 201.11 of the Tax Code. But now it has been clarified that customs declarations should be understood as temporary, additional and other types of customs declarations, according to which tax amounts are paid to the budget when goods are imported into the customs territory of Ukraine. Thus, the dilemma of attributing the amount of VAT to the tax credit from the temporary customs declarations is removed.
VAT refund
As you know, if a VAT payer has submitted a declaration stating the amount of VAT refunded from the budget and/or with a negative value of VAT over UAH 100,000, the controllers must conduct an unscheduled documentary inspection (paragraph 78.1.8 of the Tax Code). This rule still applies today. But now item 200.11 of the Tax Code prescribes separate deadlines for such an audit – 60 calendar days following the deadline for filing a tax return, and if such tax return is filed after the deadline – on the day of its actual filing.
VAT EAS
In general, the procedure of VAT EAS functioning as well as the procedure for calculating the registration limit has not changed. The legislators have only made some amendments.
First
Another component was added to the indicator ΣAdjustment. When calculating the indicator ΣAdjustment, the amount of funds withdrawn and credited by the tax officials to the VAT account according to Art. 95 of the Tax Code (establishes the procedure for collection of funds to repay the tax debt) to repay the tax debt on VAT for payment of declared tax liabilities for the periods from July 1, 2015, determined by the taxpayer in the VAT return or adjustment calculation will be taken into account.
Relevant changes have been made to item 200.4 of the Tax Code, its new paragraph “d” which now allows to contribute to the VAT account funds withdrawn by the supervisory authority in accordance with Art. 95 of the Tax Code to repay the VAT debt.
Second
It is allowed to recalculate the amount of the registration limit under the condition of renewal of VAT registration. In case of changes in the register of VAT payers by the decision of the controlling body or court, which came into force, to reverse the cancellation of VAT payer's registration, the amount ΣInvoice of such payer must be recalculated for the reporting (tax) period in which the cancellation which has been reversed, took place. Such recalculation must be carried out by the controlling body within three working days following the day of making changes to the VAT register on reverse of cancellation of registration of such payer. The exception applies only in cases where at the time of revoking of the decision to cancel the registration:
- the person is on a single tax that does not provide for the payment of VAT;
- re-registration (following the canceled one) of tax by such person is cancelled on the grounds provided for in item 184.1 of the Tax Code (it was liquidated, an application for VAT cancellation was submitted, etc.).
Third
Item 200.9 of the Tax Code provides an opportunity to register adjustment calculation together with tax invoices in the URTI due to indicator ΣExcess (when the indicator ΣInvoice is not enough).
