The Law of Ukraine “On Amendments to the Tax Code of Ukraine and certain other legislative acts of Ukraine” of 31.07.2014, № 1621-VII imposed a new national tax – the war tax, which is withheld at 1,5 % rate of personal incomes, temporarily, up to January 1,2015.The new tax is detailed further.
The budgetary classification code 11011000
Duration
From 03.08.2014 (inclusive) to 31.12.2014 (inclusive).
The accrued personal incomes to 03.08.2014 but paid after 03.08.2014, are not liable to the tax (the Ministry of Revenue and Duties of Ukraine explanation of informational resource “ZIR” of 07.08.2014).
Tax payers
The Tax payers are those persons who specified in p.162.1 Art. 162 of the Tax Code of Ukraine of 02.12.2010, № 2755-VI (hereinafter - TCU)
Specifically:
- individual – resident, who receives incomes both from their origin in Ukraine and foreign incomes;
- individual – nonresident, who receives incomes from their origin in Ukraine;
- tax agent.
The tax agent on personal income is a legal entity (his subsidiary, branch and other separate subdivision), self-employed person, nonresident agency – of the legal entity, the investor (operator) on the production sharing agreement, which, regardless of their legal status and taxation way of other taxes and/or the taxation form (payments, extension) of the income (in cash or in kind), are obliged to charge, withhold and pay the tax, which is provided for by the section IV of TCU, to the budget on behalf and at the expense of the individual from the incomes, which are paid to the person, to keep the tax accounting, to submit tax returns to the regulatory agencies and to be responsible for the violation of its provisions in the order provided by the Art. 18 and section IV of the TCU.
The tax agent, who charges (pays, provides) taxable income in favor of the taxpayer, is obliged to withhold the tax from the amount of such income at his expense, using the tax rate (sp. 14.1.180 p.14.1 Art 14 of TCU).
Taxation subject
The subjects of taxation are the incomes in the form of wages, other invitation and entitlement payments or other payments and rewards, which are accrued (paid, provided) to the payer due to the labor relations and under civil law contracts; win in the state lottery and non state monetary lottery, player’s (participant) win that is received from the gambling organizer.
Although the Instruction on wage statistics, approved by the Order of the State Statistics Committee of 13.01.2004 №5 (hereinafter – Instruction №5), is applied to determine the index of remuneration of labor in forms of State statistical observations, nevertheless the majority of accountants use it to determine the payroll budget components.
It should be noted that the payments, which are not included in the payroll budget (according to the Instruction №5), such as gifts, indemnity of the employee expenses cost, which are not confirmed by the basic documents, the amount of not refunded funds, issued to the employee on a business trip, and the other (the so-called additional benefits), are not the subject to the war tax.
Additional benefits are the means, corporeal or incorporeal values, services, other forms of income, which are paid (provided) to the taxpayer by the tax agent, if such income is not a wage and is not related to the duties of employment or is not a reward on the civil law contracts (agreements) concluded with such taxpayer (except expressly provided cases by the norms of section IV of TCU) (sp. 14.1.47 p. 14.1 Art.14 of TCU).
As to the payments on the civil law contracts, the incomes on the civil law contracts, which are included in the payroll budget, are the subject to the war tax in accordance with the explanation of the Ministry of Revenue and Duties.
That is the payments on the civil law contracts, which are not included in the payroll budget (according to the Instruction № 5), such as lease contracts, commission agreement, annuity agreement, license agreement on the property regulations disposal of the intellectual property, are not the subject to the war tax.
It should be recalled that the gambling gains are the personal incomes, so they are the subject to the war tax.
Tax assessment base
As the Ministry of Revenue and Duties noted in its explanation of informational resource “ZIR” of 07.08.2014, the subject to the war tax are the incomes in the form of wages, other invitation and entitlement payments or other payments and rewards, which are accrued (paid, provided) to the payer due to the labor relations and under civil law contracts (win in the state lottery and non state monetary lottery, player’s (participant) win that is received from the gambling organizer) without any deduction of the tax amount on the personal incomes, a single fee for state social insurance that is obligatory for all, insurance fees in Saving fund in the cases provided for by the law.
Tax rate
The tax rate is 1.5 per cent of the subject of taxation (sp. 1.3 p.16 copies. subs. 1, sec. 10 part XX of the TCU).
Transfer to the budget
The persons defined in Art. 171 of the TCU are responsible for the withholding (accrual) and payment (transfer) of the tax to the budget.
As follows:
- An employer, who pays incomes in wages (p. 171.1. Art. 171 of the TCU);
- The tax agent – for taxable incomes of their origin in Ukraine;
- the taxpayer – for foreign incomes and incomes, which source of payment belongs to the persons who are exempt from the liabilities to charge, withhold or pay (transfer) the tax to the budget 171.2 (p. 171.2. Art. 171 of the TCU).
The charging and payment of the war tax are carried out in the same manner as charging and payment of personal income tax.
The tax is paid (transferred) to the budget when the taxable income is being paid by the Unified Payment Document. The banks accept payment documents on the income payment only provided the simultaneous presentation of the payment document for transfer of this tax to the budget (sp. 168.1.2 p. 168.1 Art. 168 of the TCU).
If the taxable income is accrued by the tax agent but is not paid (not provided) to the taxpayer, the tax to be withheld from such accrued income, is the subject to the transfer to the budget by the tax agent within the established period by the TCU for monthly taxable period, viz. not later than 30 calendar days, next for the month of income charging.
Requisite details for the tax transfer
Accounts details in other regions of Ukraine
Calculation example
The accrued wage of the employee is 2 500, 00 UAH.
The war tax 1, 5%: 2500 * 1, 5% = 37, 50 UAH.
The withheld unified social tax 3, 6%: 2500 * 3, 6% = 90, 00 UAH.
The withheld personal income tax 15% (2500 - 90) * 15% = 361, 50 UAH.
The accrued payroll 2500 - 37, 50 - 90 - 361, 50 = 2011,00 UAH.
