The State Fiscal service of Ukraine taking into account the numerous questions of the main SFS departments in the regions and taxpayers regarding the technical feasibility of submitting a tax return on the company income tax for 2018 in a new form, in addition to the letter “On Amendments to the Corporate Income Tax Declaration” from 04.01.2019 No. 357/7/99-99-15-02-01-17(hereinafter – SFS letter dated January 4, 2019) and for the purpose of proper administration of the company income tax in the letter “On the technical feasibility of filing a tax return on the company income tax in 2018 for the new form” of 13.02.2019 No. 4622/7/99-99-15-02-01-17 reported the following.
In connection with the coming into effect of the Order of the Ministry of Finance of Ukraine dated October 19, 2013, No. 842 “On Approval of the Changes to the Form of the Tax Return on Company Income Tax” dated October 14, 2018, registered in the Ministry of Justice of Ukraine on November 15, 2018, under No. 1303/32755 (hereinafter – Order No. 842), an updated form of the tax return on the company income tax was developed and implemented (form ID J0100117 for legal entities) (hereinafter – a new form return).
Taking into account that the edition of the order No. 842 is due to changes from 01.01.2018 in the taxation of the company income taxthat affect the budget indicators, the SFS letter dated January 4, 2019 recommended that the payers of the company income tax for the base reporting (tax) period – 2018 submit a new form tax return.
The electronic form for identifier J0100117 is placed on the official SFS web portal under the heading: Electronic Reporting > Electronic Reporting for Taxpayers > Information and Analytical Support > Register of forms of electronic documents and is available for use by software developers.
The electronic form according to the identifier J0100117 requires the establishment of the mark “basic reporting period quarter” or “basic reporting period year”. The mentioned above should be realized in the software, which is used by the payer to submit a new return form in electronic form.
Accordingly, SFS information systems ensure the acceptance of the new form return according the identifier J0100117 as if there is a mark “basic reporting period quarter” – for taxpayers who make a tax return from the company income tax (hereinafter – the return) for tax (reporting) periods of the quarter, half year, three quarters, a year, and in the presence of the mark “basic reporting period year” – for taxpayers for whom the annual tax (reporting) period was set.
However, para. 46.6. of Art. 46 of the Tax Code of Ukraine (hereinafter – TCU) established, if as a result of changes in the tax rules, the forms of tax reporting change, to the definition of new return forms (calculations) that take effect for the reporting period following the tax period in which occurred their disclosure are valid, forms of returns (calculations) are valid for such definition.
Taking into account the aforesaid, until April 1, 2019, the adoption of returns will also be ensured in the form approved by the order of the Ministry of Finance of Ukraine of 20.10.2015 No. 897 (as amended by the order of 28.04.2017, No. 467), namely:
· for the basic reporting period year – according to ID form J0108104;
· basic reporting period quarter – according to ID form J0100116.
In accordance with para. 50.1 of Art. 50 of TCU, if in the future tax periods (taking into account the statutory deadlines specified in Art. 102 of the TCU), the taxpayer independently (including by electronic verification) detects errors contained in his/her previously filed tax return, he/she is obliged to send a clarifying calculation to such a tax return in the form of the current at the time of submission of the clarifying calculation.
Thus, in case of necessity to make changes to the tax reporting for past tax (reporting) periods in the manner specified in Art. 50 of TCU, until 01.04.2019 the taxpayers will have the opportunity to submit clarifying returns according to J0108104, J0100116 and J0100516 forms.
When correction of errors during tax (reporting) periods of 2015-2017 by business entities - producers of agricultural products, which selected the annual tax (reporting) period in accordance with sub-para. 137.4.1 of para. 137.4 of Art. 137 of TCU, such payers in the clarifying returns must mark the “manufacturer of agricultural production” in the field 9 “Special notes” of the title part of the return and can use the identifier of J0100516 form, which will be valid till 01.04.2019, and in the future – a new form according ID J0100117.
After 01.04.2019 the clarifying returns will be accepted only for the new form (according ID J0100117).
According to sub-para. five of para. 50.1 of Art. 50 of TCU, if upon submission of the returns for the reporting period, the taxpayer submits a new declaration with corrected indicators before the expiration of the deadline for submission of the return for the same reporting period, then the fines specified in this paragraph should not be applied.
In case of submission by the payer of a new form return for 2018 in a new form according to identifier J0100117 before the expiration of the deadline (01.03.2019 inclusive), the tax liability is determined on the basis of the last submitted return, despite the previously submitted form ID J0108104 or J0100116.
Please note that payers of the unified tax (individuals and legal entities) who made in 2018 in favor of a non-resident – a legal entity or a person authorized by him/her any payments in accordance with para. 297.5 of Art. 297 of TCU should accruals and pay tax from the non-resident incomes in the order, amount and within the terms set by section III of the TCU. Such payers will be required to submit a declaration in a new form with the obligatory placement of the mark “the unified tax payer” in the field 9 “Special Notes” of the title part of the return and the submission of the application to the line 23 of tax return. Submission to the return of other annexes and financial statements from the unified tax payers is not required.
At the same time, the unified tax payers use a new return form according the identifier J0100117 - for legal entities and according the identifier F0100702 – for individuals.
The State Fiscal Service of Ukraine in the category 102.23.02 “ZIR” answered the question whether the Management Report together with the annual Tax Return on Company Income Tax should be submitted to the SFS authorities?
In accordance with para. 46.2 of the TCU, the taxpayer submits the quarterly or annual financial statements, together with the relevant tax return, in the manner prescribed for filing a tax return, taking into account the requirements of Art. 137 of TCU.
The financial statements, which are drawn up and submitted in accordance with paragraph 46.2 of TCU, by the payers of the income tax, are an appendix to the tax return of the company income tax and its integral part.
The legal principles of regulation, organization, accounting and financial reporting in Ukraine are defined by the Law of Ukraine “On Accounting and Financial Reporting in Ukraine” dated July 16, 1999, No. 996 (hereinafter – the Law).
Article 11 of the Law defines general requirements for financial statements, in particular, the procedure and terms for filing financial statements, the Management Report (hereinafter – the Report) are determined by the Cabinet of Ministers, and for banks – the NBU.
The report is submitted with the financial statements and the consolidated financial statements in accordance with the procedure and terms established by the law.
Art. 1 of the Law defines the terms, in particular, the Report is a document containing financial and non-financial information that characterizes the state and prospects of a company development and reveals the main risks and uncertainties of its activity.
The Resolution of the Cabinet of Ministers of Ukraine of 11.07.2018, No. 547, which came into force on July 14, 2018, made amendments to the Procedure for filing financial statements approved by the Resolution of the Cabinet of Ministers of Ukraine of 28.02.2000 No. 419, according to which, taxpayers should submit a Report together with the annual financial statements.
If the company submits consolidated financial statements, a consolidated report should be submitted. Medium-sized companies have the right not to reflect non-financial information in the Report.
The financial statements are submitted to the bodies to which the companies belong, the labor collectives, at their request, to the owners (founders) in accordance with the constituent documents, as well as in accordance with the legislation, to other bodies and users, in particular, the state statistics bodies.
Banks submit financial statements, consolidated financial statements, the Report and the consolidated Report to the National Bank in accordance with the procedure established by the latter.
In this case, the annual financial statements, the annual consolidated financial statements, the Report, the consolidated Report, the Report on Payments in favor of the State and the consolidated Report on Payments in favor of the State, preparing of which stipulated by the law, must be made public together with the audit report on the web page or the web-site of the company (in full) and in other ways in cases stipulated by the legislation.
Guidelines for the Report are approved by the Ministry of Finance Order No. 982 dated 07.12.2018.
The general requirements to financial statements are determined by the National Accounting Standards 1, approved by the Ministry of Finance Order No. 73 of 07.02.2013, (hereinafter – Accounting Standards).
Point 1 of sec. II of Accounting Standards has established that the financial statements consist of: the balance sheet (report on financial position), the report on financial results (report on comprehensive income), report on cash flows, report on equity and notes to the financial statements.
In the form of the Tax Return on Company Income Tax, approved by the Ministry of Finance Order No. 897 dated 20.10.2015 (hereinafter – the Return), it is foreseen to reflect the following forms of financial statements, as the “FR” application to the Return, which are marked with the presence of before submitted forms of Returns of financial statements:
· Balance sheet (report on financial position);
· Report on financial results (consolidated income report);
· Report of Cash Flows;
· Equity Report;
· Notes to the annual financial statements;
· Financial Report of a Small Business Entity (Balance Sheet, Report on Financial Results);
· Simplified financial report of a Small Business Entity (Balance Sheet, Report on financial results).
Confirmation of submission of financial statements together with the Return is a “+” mark in the “FR” table of the “Availability of annexes” and in the table “Availability of applications submitted to the Tax return on the company income tax - forms of financial reporting”.
The payer should put the mark in columns of the table corresponding to the names of the forms of financial statements submitted together with the Return.
Taking into account the above, the Report is not an integral part of the financial statements and, accordingly, the obligation to submit the report to the controlling bodies together with the Return is not defined by the law.
