Blocking of Tax Invoices (PN/RK): Why Your Business Became “Risky” and How to Rescue VAT from the System’s Captivity

You open your electronic cabinet to check the registration of an invoice, and there it is — a red status. A suspension receipt. At this moment, your business is effectively put on pause. Your working capital is frozen, your counterparty is anxious and threatens fines, and the State Tax Service (STS) expects justifications from you.

This is not a technical glitch. It is a deliberate budget-filling policy that has become even more aggressive in 2026.

I, Denys Fedorkin, managing partner of Law Business Association, have been dealing with taxes since 2004. I have seen manual management transition into “automatic,” and I’ll say it bluntly: the SMCORE algorithms (risk assessment criteria monitoring system) make mistakes more often than people today. But you are the one paying for these mistakes.

In this article, we will break down the mechanics of blocking through the lens of large deals, specifically regarding real estate sales taxes in 2026, and provide tools for protection.

The Anatomy of Blocking: How the Inspector (and Algorithm) Thinks

Let’s look “under the hood” of the system. Many LBA clients believe they were blocked “by request.” Sometimes this is true. But in 90% of cases, the blind logic of the algorithm, prescribed in the CMU Resolution №1165, is triggered.

The inspector or system sees the picture like this:

1. Goods Inconsistency. You bought cement but are selling office space. For the system, this is “mismatching,” even though for a developer, it is a production process.
2. Lack of Resources. you have no officially employed staff, warehouses, or equipment (Form 20-OPP is not filed or empty), but you are closing multi-million deals.
3. Risky Counterparty. You are working with a company that already has a “black mark.” The risk virus spreads instantly: one “toxic” supplier in the chain can bring down your entire tax credit.

Tax authorities think in terms of “tax burden.” If you pay little while turnovers are high — you are a target.

In 2026, the STS is not interested in the essence of your business model. They are only interested in whether your activity matches their templates. Your task is not to ask but to force the system to recognize the reality of the operation.

Real Estate Transactions as a Trigger for Blocking

The tax office pays special attention to capital-intensive operations. This is a high-control zone. When real estate sales taxes in 2026 are calculated, the system automatically verifies the origin of the asset.

Imagine a situation. Your company invested in the construction of a warehouse complex. Now you are selling it. The VAT amount in the invoice is significant. What does the system do? It scans your “input” VAT. If you formed credit through, say, marketing services or fuel purchases, but are selling real estate — the algorithm sees “commodity position substitution.”

The result is blocking.

An even more complex situation is the land purchase by a legal entity in 2026. Land is a VAT-exempt commodity (in most cases), but related services, commissions, and site preparation works — all these create tax liabilities and credit. If the legal entity buying the land was previously engaged in wholesale grain trade, the system will block the invoices of contractors clearing the site due to “inconsistency in types of activity.”

At Law Business Association, we handled a case where a developer client was granted “risky” status simply because they started selling apartments before the object was officially commissioned on paper. The system did not see “finished products” in stock. We unblocked the company’s operations through court, proving the reality of business transactions, but time was lost.

Legal Hack: Data Table as a Preventive Strike

Most businessmen run to lawyers only when the “fire” is already blazing — the suspension receipt has been received. This is a strategic mistake.

My experience shows: the best defense is an attack. Or, in our case, a “vaccination.” This vaccination is the Taxpayer Data Table.

This is a document you submit to the STS, where you effectively declare: “Look, I buy cement, rebar, pay architects (UKTVED codes at input) to create and sell real estate (UKTVED code at output).”

Why is it important to do this BEFORE active sales begin?

1. If the Table is accepted, your PN/RK under the specified codes are not subject to monitoring for “mismatching.”
2. You receive “immunity” from automatic blocking for specific types of activity.

But there is a nuance. The tax office often refuses to accept the Table without explaining the reasons. “Insufficient information” is their favorite excuse. At LBA, we have developed an explanation structure for the Table that minimizes the chance of refusal: we include everything — from the staffing table to production technology maps. We show them so much paperwork that it’s easier for them to agree than to read.

What to Do When Blocking Has Already Occurred

If prevention didn’t work (or didn’t exist), we move to treatment. According to Art. 201.16 of the Tax Code of Ukraine, you have 365 days to submit explanations. Do not delay.

Unblocking Algorithm from LBA:

1. Receipt Analysis. Clearly identify the reason. Item 1 “Taxpayer Risk” or Item 8 “Operation Risk”? These are two different wars. Taxpayer risk blocks EVERYTHING. Operation risk blocks a specific invoice.
2. Evidence Collection. The principle here is “the more, the better.” Contracts, acts, waybills (TTN is a must!), payment orders, warehouse receipts, correspondence with the counterparty. If it is a land purchase by a legal entity in 2026, add extracts from the registers of property rights and founders’ decisions.
3. Written Explanations. This is not a free-style essay. It is a legal document. Structure: “Essence of operation -> Chronology -> Availability of resources -> Economic benefit.”
4. Regional Level Commission. They review your explanations. If refused — an appeal to the central level of the STS.

Only after passing administrative appeal do we go to court. And here, statistics are on our side. In 2025-2026, courts have been massively siding with taxpayers if the operation’s reality is proven. Judges understand: the absence of a waybill (TTN) does not mean the service was not provided if other evidence exists.

Read more about our tax dispute practice here.

Why Does Business Lose?

Clients often come to us after trying to unblock invoices on their own or with an “outsourced accountant.” Main mistakes:

• Synthetic Documents. Trying to fake a date in a waybill or providing a “backdated” contract. The tax office has access to police and customs databases. If the vehicle listed in the waybill could not physically be at the loading point — it’s over. A criminal case instead of a tax credit.
• Silence. Ignoring tax office requests for information.
• Absence of 20-OPP. You cannot transport goods if you have no vehicles (owned or leased) known to the tax office.

Remember, the commission of the STS is a bureaucratic mechanism. They look for formal grounds for refusal. Do not give them those grounds.

Conclusions

Blocking of PN/RK is a pressure tool that has become commonplace. You cannot rely on “luck.” When real estate sales taxes in 2026 or large investment projects are at stake, the price of error is measured in millions.

At LBA, we follow the principle: the client’s financial result is the only criterion for a lawyer’s success. We don’t write long memorandums about “how bad everything is.” We prepare Data Tables, secure decisions at commissions, and win in courts.

If you see a suspension receipt — do not wait. Every day of delay complicates the situation. Contact us for a risk analysis of your situation.