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VAT taxation of transactions for the supply of medical devices
VAT taxation of transactions for the supply of medical devices
Regarding the temporary exemption from VAT of transactions for the supply and import of medicines and medical devices:
In order to implement the necessary measures aimed at preventing the occurrence and spread, localization and elimination of outbreaks, epidemics and pandemics of coronavirus disease (COVID-19), the Law on Amendments to the TCU №532-IX of 17.03.2020 was adopted. and 530-IX with changes from 18.04.2020. which established an exemption from VAT on the import and / or supply of medicines, medical devices and / or medical equipment, namely:
1. In accordance with paragraph 38-1 of subsection 2 of the XX TCU, until December 31, 2022 are exempt from VAT if the import and / or supply (transfer) of medicines, medical devices and aids to them is carried out at the expense of the state budget for the implementation of relevant agreements (contracts) concluded by the person authorized to carry out procurement in the field of health care, within the framework of implementation of programs and implementation of centralized health care measures:
The list of goods that are exempt from VAT under this paragraph can be found in the Resolution of the Cabinet of Ministers of March 20, 2020 № 225 at the link: Law.
However, in case of misuse of medicines, medical devices and auxiliary means to them in accordance with this paragraph, the taxpayer is obliged to increase tax liabilities as a result of the tax period for which such violation occurs, by the amount of value added tax, which had to be paid upon import into the customs territory of Ukraine (supply in the customs territory of Ukraine) of such medicines, medical devices and auxiliary means to them, as well as to pay a fine in accordance with the law.
2. With regard to benefits for the supply of medicines, medical devices and / or medical equipment that are not carried out in the order of public procurement and other conditions of paragraph 38-1, according to paragraph 71 of subsection 2 of XX TCU, temporarily, for the period ending on the last calendar day of the month in which the quarantine established by the Cabinet of Ministers throughout Ukraine ends, transactions on import into the customs territory of Ukraine and / or operations on supply of goods (including medicines, medical supplies) on the customs territory of Ukraine shall be exempt from VAT. products and / or medical equipment.
The VAT payer who supplies goods subject to the exemption does not lose the “incoming” VAT, as the provisions of paragraph 198.5 of Art. 198 and Art. 199 of the TCU do not apply, and tax liabilities are not accrued. Accordingly, such a payer retains the right to recognize a tax credit for VAT paid on imports of goods with a list determined by the Cabinet of Ministers of Ukraine, when purchasing them, or as part of goods (works, services) used in the production of these goods (for the manufacturer ).
* The provisions of this paragraph apply to transactions carried out from March 17, 2020.
With the list of medicines, medical devices and / or medical equipment that are temporarily exempt from VAT under item 71 of subsection. 2 of the XX TCU can be found in the Resolution of the Cabinet of Ministers of March 20, 2020 № 224, at the link: https://zakon.rada.gov.ua/laws/show/224-2020-p
However, it should be noted that these benefits apply only:
That is, benefits apply to goods manufactured or imported / put into circulation in the customs territory of Ukraine by enterprises that have all the necessary licenses / permits / results of examinations / certificates or other permitting documents, for their further implementation. Privileges do not apply to hand-sewn masks or unregistered means.
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