The Cabinet of Ministers of Ukraine by its Resolution “On Amendments to the Procedure for Using the Funds Envisaged in the State Budget for Financial Support of Measures in the Agro-Industrial Complex by Reducing Lending” of 07.02.18, No. 254 states that in 2018 partial compensation of the interest rate on loans in the national currency will be paid to farmers who have net income from sales of goods for the last year to UAH 20 million. At the same time, preference will be given to borrowers involved in growing vegetables in open soil, sugar beets, horticulture and berry farming.
The government has also expanded the list of farmers who will qualify for compensation in the second stage. Now, the second stage will include farmers who carry out activities of cultivation and breeding animals (cattle, sheep and goats, rabbits, pigs and poultry (except for chicken and poultry eggs) and used the loan funds to cover the costs associated with such activity.
The State Fiscal Service of Ukraine in its Individual Tax Advice “On Adjustment of Financial Results to Taxation” of 27.03.18, No. 1260/6/99-99-15-02-02-15/ІПК reported that the provision of fulfilment of obligations (deposit), which is not subject to return in the event of violation of the terms of the contract, falls under the definition of a forfeit. Since the forfeit (fine, penalty) is a monetary amount or other property that the debtor must transfer to the creditor in case of violation by the debtor of the obligation (para. 1 and 2 of Art.549 of the Civil Code of Ukraine).
Consequently, for tax-profit purposes, the amount of funds transferred, which are not returned to the payer in connection with the violation of the obligation, it is necessary to increase the financial result before tax in accordance with para.140.5.11 of the Tax Code of Ukraine (hereinafter - TCU). Such a rule applies if the funds are paid in favour of persons who are not taxpayers (except for individuals) and taxpayers who are taxed at the rate of 0% under para.44 of sub-para.4 of sec. XX “Transitional provisions” of TCU.
The State Fiscal Service of Ukraine in its Individual Tax Advice “On Calculation by the Payer, Which Applies the Cash Method of VAT, of Tax Obligations in Writing off Receivables from Consumers” of 27.03.18, No. 1242/6/99-99-15-03-02-15/ІПК reports that the cancellation of overdue receivables for supplied and unpaid goods (services) can be costly for the taxpayer who applies the cash method. Representatives of the fiscal department require of the VAT payer to calculate tax liabilities during such a transaction. In their view, the write-off of accounts receivable is the receipt by the payer of other types of compensation.
The State Fiscal Service of Ukraine in its Individual Tax Advice “On Reducing the Financial Result Before Taxation to the Amount of the Negative Value of the Object of Taxation of Previous Years in the Event of a Change in the Type of a Joint-Stock Company” of 27.03.18, No. 1240/6/99-99-15-02-02-15/ІПК reports that the change in the type of a joint-stock company does not deprive the one who have profit of the right to reduce the financial result before taxation to the amount of the negative value of the object of taxation of previous years.
According to the representatives of the fiscal department, during the change of type of a joint-stock company from a public to private one, termination of the partnership does not occur. Consequently, it has the full right to take into account last year’s losses due to the reduction of the object of taxation for subsequent reporting periods after the introduction of such changes.
The State Fiscal Service of Ukraine in its Individual Tax Advice “On the calculation of depreciation on the leased premises” of 04.04.18, No. 1369/6/99-99-15-02-02-15/ІПК clarified whether the “depreciation” differences in the case of improvement of the rented premises.
Since the cost of improving the rented premises in the account of the lessee leads to the creation of a new fixed asset (sub-para. 2 of para. 8 of Accounting Standard 14 “Lease”) - the adjustment from para. 138 of TCU should be carried out.
Consequently, profit makers using the differences must:
- increase the financial result before tax to the amount of accrued depreciation for such a fixed asset in accordance with Accounting standards or IAS (para. 138.1 of TCU);
- reduce the financial result before tax to the amount of the estimated depreciation of such a fixed asset in accordance with para.138.3 of TCU (para. 138.2 of TCU).
The Ministry of Finance of Ukraine by its Order “On Approval of Amendments to the Procedure for Preparing Budget Reporting by Managers and Recipients of Budgetary Funds, Reporting by Mandatory State Social and Pension Insurance Funds” of 02.03.18, No. 340 approved amendments to the Procedure for Preparing Budget Reports.
The most important changes are:
- reporting to the Treasury bodies can be submitted electronically using the automated system for submitting electronic reporting by the clients of the State Treasury – АС “Є-Звітність” (E-Reporting system);
- reporting of recipients of budget funds, in the staff list of which there are no persons having the right of the second signature, signed by persons who have the right of first signature;
- if the reporting is submitted using the E-Reporting system, the number of sheets for each form of reporting is not indicated in the covering letter;
- in the new wording, Appendix 7 and Annex 22 are given;
- Annex 20 “|Reference on the allocation of own revenues that exceed the corresponding expenditures approved by the law on the State Budget of Ukraine (local budget decision)” is excluded.
The Ministry of Finance of Ukraine posted and made publicly debated a bill on its website aimed at introducing criteria for the identification of high-ranking individuals.
Representatives of the financial department propose to classify as category of wealthy people - taxpayers of the income tax - residents, which meet one of the criteria:
a) is the ultimate beneficial owner (controller) of a large taxpayer;
b) directly or indirectly holds 10% or more of the authorized capital or the voting rights of the acquired shares of a legal person who is a tax resident of another state and declared (received) income for the previous tax (reporting) year 10 and more million euros;
c) total annual taxable income for the previous tax (reporting) year exceeds UAH 50 million.
Also, the draft law provides that:
- the category of people with high incomes must be taken on a separate record;
- wealthy people must annually declare their wealth;
- the SFSU should have access to information on bank accounts of wealthy people;
- it is necessary to expand the amount of information on bank accounts of high-income persons, which can be received by the bodies of income and fees at the written request of the banking institution.
The Ministry of Economic Development and Trade of Ukraine by its the letter “On succession and newly created legal entities” of 23.03.18, No. 3304-04/12631-07, clarifies the rules for the conclusion and execution of a procurement contract, if the customer or participant to be reorganized, and such a legal entity is suspended.
The assignee of the customer may take actions in respect of the completion of procurement procedures initiated by a legal entity that has been terminated as a result of the reorganization or in the case of execution of a procurement contract signed by such a person. Of course, provided that the succession is executed properly.
In addition, a new legal entity formed as a result of the reorganization of the procurement participant, to which the relevant rights and obligations have been transferred, has the right to take actions to execute the procurement contract concluded by the predecessor.
The Ministry of Foreign Affairs of Ukraine on its website reported that Ukrainian consular offices began to issue electronic visas to foreign tourists and businessmen.
The simplification of the process of processing Ukrainian visas will strengthen the tourism and transport business. In addition, it will be easier to establish business ties.
In order to claim for e-visa processing it is necessary fill in the online application form, download the scanned copies of the required documents, pay on the website with a bank card and print out the electronic visa received on the e-mail address.
Visa processing terms are shortened to 9 business days.
An electronic visa will be only one time, and stay in the territory of Ukraine can be up to 30 days.
E-visas have been introduced for citizens of the following countries: Australia, Antigua and Barbuda, Bahamas, Barbados, Bahrain, Bolivia, Bhutan, Vanuatu, Haiti, Guatemala, Honduras, Grenada, Dominica, Dominican Republic, Indonesia, Cambodia, Qatar, Costa Rica, Kuwait, Laos, Mauritius, Malaysia, Maldives, Mexico, Micronesia, Myanmar, Nepal, Nicaragua, New Zealand, Oman, Palau, Peru, El Salvador, Samoa, Saudi Arabia, Seychelles, Saint Vincent and the Grenadines, Saint Lucia, Singapore, Suriname, Thailand, Timor-Leste, Trinidad and Tobago, Tuvalu, Fiji, Jamaica.
