The owner of the car - a legal entity transfers it to the lessee for financial leasing. The car has Ukrainian registration and all relevant documents. Who should pay the transport tax in this case and what nuances should be foreseen - read below.
Legal aspects of paying transport tax
According to item 267.2.1 of the Tax Code of Ukraine (hereinafter – the Tax Code), the object of taxation is passenger cars, from the year of manufacture of which no more than five years have passed (inclusive) and the average market value of which is more than 375 times the minimum salary established by law as of January 1 of the tax (reporting) year.
Payers of transport tax are individuals and legal entities, including non-residents, who have their own passenger cars registered in Ukraine in accordance with current legislation, which, in accordance with item 267.2.1 of the Tax Code, are objects of taxation.
Taxpayers - legal entities independently calculate the amount of tax as of January 1 of the reporting year and no later than February 20 of the same year submit to the regulatory authority at the place of registration of the taxable object a tax declaration on transport tax in the form established in the manner provided for in Article 46 of the Tax Code, with a breakdown of the annual amount into equal quarterly installments.
The Declaration form was approved by Order of the Ministry of Finance No. 415 of April 10, 2015 (as amended by Order of the Ministry of Finance No. 401 of November 30, 2022).
Regarding taxable objects acquired during the year, the Declaration is submitted within a month from the date of the emergence of ownership of such an object, and the tax is paid starting from the month in which the ownership of such an object arose (paragraph 267.6.4 of the Tax Code).
Financial leasing terms
According to point "b" of item 14.1.97 of the Tax Code, financial leasing is a business transaction of a legal entity (lessor), under which the lessor transfers to the lessee property that is the main asset and purchased or manufactured by the lessor, as well as all risks and rewards associated with the right to own and use the financial leasing object.
Leasing is considered financial if at least one of the following conditions is met:
- the leasing object is transferred for a period during which at least 75 % of its original cost is depreciated, and the lessee is obliged, on the basis of the leasing agreement and during its term, to purchase the leasing object with the subsequent transfer of ownership from the lessor to the lessee at the price specified in such leasing agreement;
- the book value (residual) of the leased object at the time of the expiration of the leasing agreement provided for by such agreement is no more than 25 % of the initial value of the price of such leased object, valid at the beginning of the lease agreement;
- the amount of leasing payments specified in the leasing agreement at the time of conclusion of such agreement is equal to or exceeds the initial cost of the leasing object;
- the property transferred for leasing, manufactured to the order of the lessee and after the expiration of the leasing agreement cannot be used by persons other than the lessee, based on its technological and quality characteristics.
Thus, in the case of a car being transferred for financial leasing, the payer of transport tax for vehicles registered in Ukraine in accordance with current legislation is the lessor (legal entity - owner of the vehicle). In this case, the Declaration is submitted at the place of registration of the taxable object within a month from the date of the origin of the right of ownership of such an object, and the payment of transport tax is made from the month in which the right of ownership of such an object arose.
