The President of Ukraine signed the EU Association Agreement. Further, the Document should be ratified by the Verkhovna Rada of Ukraine.
The amendments would be made in the export transactions according to the Agreement. In particular, the import duties would be abolished and nontariff restrictions would be reduced in agricultural trade. It should be noted that the abolition of EU import duties on the majority of goods to be held during the first year of the agreement (on 99% of tariff lines). Ukrainian exporters also should receive the additional benefits on goods, the EU offered the tariff quotas in relation to the benefits. It is referred to pork meat, chicken meat, sugar and other similar products. Ukraine has had the opportunity to deliver the definite volumes of these goods free of import duties. The Certificate of Origin of Goods EUR.1, which is issued by the Chamber of Commerce and Industry, should be obtained for goods delivery to the EU exporting companies.
Concerning the import, the maximum production sales growth of chemical industry and mechanical engineering industry to the European countries is expected. The production import growth of food industry and agriculture, manufacturing of other non-metallic mineral products, textile and leather industry, and other types of production, transport and finance services is expected. The import products should be lower in price and its assortment should be significantly expanded.
The ensuring of the free capital movement due to the direct investments implemented in accordance with the law of the country as well as associated with the trade credits is provided for according to the arrangement on the provisions of the Agreement in terms of the capital movement and payments.
The Association Agreement does not make easier the requirements in terms of employment opportunities of our experts in the European Union.
The Ministry of Revenue and Duties of Ukraine reminded that the pensions income taxation is implemented since July 1 by the Law of Ukraine “On Prevention of financial catastrophe and creating prerequisites for economic growth in Ukraine” of 31.03.2014, № 1166-VII (hereinafter – Anti-crisis Act). Thus, the pension amounts or monthly life-time financial allowance are included in total taxable income, which are received from the Pension Fund of Ukraine or the budget, if their size exceeds 10 000 UAH per month, as well as pensions from foreign sources, if such pensions are subject to taxation or taxed in the country of their payment according to the international treaties.
Regarding such excess 15% tax rate is applied.
For example, if the pension exceeds 10 000 UAH and is, let it be, 12 170 UAH, so the difference (2 170 UAH) is taxed at 15% rate (if the excess amount stays within the 10 minimum wages –12 180 UAH, and the larger amounts are taxed at 17% rate) since July 1.
The another part of Anti-crisis Law concerning the children social benefits – child birth benefit and childcare allowance for children aged under three years old should enter into force since July 1, 2014.
Thus, since 01.07.2014:
- the childcare allowance for children aged under three years old is canceled. Those, who received the right to this allowance up to 01.07.2014, would be entitled to child allowance until the child reaches the three years old;
- child birth (or adoption) benefit (regardless of whether the child is the first, the second or the third) would be 41 280 UAH and would be paid as follows: the lump-sum child care allowance in amount of UAH 10 320, and the rest of benefit amount – during the next 36 months in equal parts;
- the persons, who receive the child birth benefit since 01.07.2014, would be the unified social tax payers.
Also, draw your attention to the appropriate amendments, which have been already made by the Cabinet, in setting procedure and payments of State aid to families with children, and these amendments come into force since July 1, 2014.
In addition, the progressive scale of Personal Income Tax taxation of the passive income (dividends, interest, royalties, investment income) is introduced by the Anti-crisis Law, this scale has the following form:
15 % tax rate – if the tax base of the fiscal year does not exceed the 204 subsistence minimums;
20 % - if the tax base of the fiscal year exceeds the 204 subsistence minimums, but does not exceed the 396 of subsistence minimums to the amount of such excess;
25% - if the tax base of the fiscal year exceeds the 396 subsistence minimums to the amount of such excess.
Furthermore, the interest is taxed only if its amount exceeds the 17 subsistence minimums per year.
During the fiscal month the passive incomes would be taxable by the tax agent at each accrual (payments) at 15 % rate. The taxpayer should recalculate the taxable incomes including the progressive scale of the passive incomes in property declaration as of the end of the financial year.
The regulations of dividends taxation would enter into the force since January 1, 2015. Until then, the dividends are final taxed under its payment at 5 % rate and they are not subject to recalculation at year-end 2014.
The Ministry of Revenue and Duties of Ukraine reminded that the rates on certain taxes and duties are increased from the second quarter of 2014.
According to the Anti-Crisis Law from the second quarter the rates of charges for special water use, for the subsurface use and Eco-tax are increased.
Thus, the rates of charges for special water use have been increased at about 8.6% for all directions of sources use. At the same time, the calculations procedures and the payment of duties remained constant.
The eco-tax is charged at the new rates since April 1, the rates are increased at about 8.3%.
Regarding payment for the use of subsurface, we should take note of the expansion of the circle of the taxpayers for mining transactions.
In particular, the land holders and the land users are referred to the payers, who mine the subsurface water according to the permission in the range of their granted lands, which size exceeds the fixed standards, as well as those who mine the fresh groundwater using the electrical devices in volume excess of 13 cu m per person per month.
The payers, who specified in the paragraphs 263.1.6 of the Tax Code of Ukraine (hereinafter – TCU), apply the rates, which are established by the paragraph 325.2 of the TCU for duties for the subsurface water special use, while calculating the tax liabilities of fee for the subsurface use in the fresh groundwater mining.
In addition, the new rates of the charge for the subsurface use for the purposes, which are not related to the mining operations, are implemented by the Anti-Crisis Law.
The Ministry of Finance in its letter of 29.04.2014, № 31-08430-10-10/10149 reported that the accounting records are maintained under applicable laws of Ukraine at the temporarily occupied territory.
The temporarily occupied territory is an integral part of the territory of Ukraine and the legislation of Ukraine is extended to this territory.
The individuals, regardless of whether they have refugee status or other special legal status, as well as the economic entities reserve the ownership right and other proprietary interests in property, including the real properties and the sites of land, which are at the temporarily occupied territory, if they have been purchased in accordance with the laws of Ukraine.
Therefore, the assets in the accounting records are implemented as per the existing laws and regulations on the accounting records and the financial data reporting. There are no any legislative grounds for the introduction of amendments in the accounting of the State Property Objects, which are situated on the temporarily occupied territory. The decision of the question should be provided by the separate regulatory legal act.
In the financial data reporting the property, the assets and the liabilities within the temporarily occupied territory, are reflected in the remaining amount at the beginning of the year.
The National Bank of Ukraine in its letter of 26.06.2014, № 18-112/33663 reported that the restriction of 150 000 UAH is not extended to the amount issuing by the Depositors Insurance Fund.
The NB determined by the Resolution № 328 that the banks are required to restrict the issuing of cash hryvnias from the current (including card accounts) and the deposit accounts of the clients using cash offices and ATMs in the range up to 150 000 UAH per day per client.
The specified requirements are not extended to the cash issuing for wages payments, business trips, pensions, scholarships, and other social and related payments (except material aid).
With reference to the requirements of the mentioned above Resolution, the Depositors Insurance Fund makes payments through some agent-banks, these banks restricted the cash issuing (in the amount of the maximum refund 200 000 UAH).
Taking into account the social significance of faultless payments of guaranteed amount refunds, the National Bank reported that the Resolution norms № 328 are not extended to the depositors’ payment refunds at the expense of the Depositors Insurance Fund.
