Regarding changes in income tax
Regarding changes in income tax
Regarding changes in income tax:
1. The circle of income taxpayers has been expanded, legal entities applying the simplified taxation system for the payment of income (profits) to a non-resident with their source of origin from Ukraine have been added.
2. Single taxpayers of group 4 are not taxpayers when paying dividends to a non-resident in the form of:
2.1. payments for securities (corporate rights), in controlled transactions in excess of the amount that corresponds to the principle of “outstretched” hand;
2.2. the value of goods (works, services), except for securities and derivatives purchased from a non-resident, in controlled transactions in excess of the amount that corresponds to the principle of “outstretched” hand;
2.3. the amount of understatement of goods (works, services) sold to a non-resident in controlled transactions compared to the amount that corresponds to the principle of “outstretched” hand.
3. Legal entities applying the simplified taxation system are also payers of income tax, upon receipt of the adjusted profit of a controlled foreign company, which is taxed in the manner prescribed by Art. 39-2 and year III of the Tax Code of Ukraine (hereinafter – TCU).
The relevant rule enters into force on 01.01.2021
4. Individual entrepreneurs are also payers of income tax, including simplified and “independent” in respect of income (profits) paid to a non-resident with their source of origin from Ukraine, as well as legal entities that are foreign companies and take place effective management in Ukraine (the definition of “place of effective management” is attached to the TCU. The relevant rule enters into force on 01.01.2021
5. Non-resident taxpayers include non-residents who carry out economic activity on the territory of Ukraine through a permanent establishment and / or receive income from their source in Ukraine, and other non-residents who are obliged to pay income tax.
It is stated in the new edition of items. 133.2.2 TCU.
6. Increasing the threshold for non-adjustment of the pre-tax financial result for all differences, except for the negative value of the object of taxation of previous years, for business entities whose annual income from any activity is up to UAH 40 million. (previously it was UAH 20 million).
Changed paragraphs. 134.1.1 TCU.
In addition, from January 1, 2021, businesses with an annual income of less than UAH 40 million will be able to file only annual income tax returns.
7. For legal entities that are foreign companies and have effective management on the territory of Ukraine, income with a source of origin outside Ukraine is not subject to taxation.
8. Added new objects of income tax. 134.1.6 and 134.1.7 of the TCU, including:
8.1. income from gambling on the use of slot machines (after the legalization of the gambling business – ed.);
8.2. adjusted profit of a controlled foreign company (determined separately from other objects of taxation and for each such company, if there are several). The basic (basic) rate of 18% is applied to such profit. The relevant rule comes into force on 01.01.2021
8.3. a new article is added. 39-2 of the TCU, which accounts for controlled foreign companies. The relevant rule enters into force on 01.01.202
9. The rates of income tax on income of non-residents and persons equated to them with their source of origin in Ukraine have been changed – 0, 4, 6, 12, 15 and 20%
10. From 01.01.2021 the annual reporting period for such taxpayers of item 137.5 of TCU is established, in particular:
11.1. natural persons-entrepreneurs, including simplistic and “independent” in relation to income (profits) paid to a non-resident
11.2. legal entities, in particular, simplifications, regarding income paid to a non-resident
12.3. legal entities applying a simplified system of taxation in respect of the adjusted profit of a controlled company, which is taxed in accordance with the new Article. 39-2 and year III of the TCU.
13. The peculiarities of calculating the amount of income tax paid by the controlling person of the controlled foreign company are determined, the amount of tax is reduced by the amount of corporate tax or similar tax levied under the legislation of foreign countries actually paid by the controlled foreign company, including taxes, withheld from sources of payment from the amount of income received by such company. The amount by which income tax can be reduced is defined as the total amount of tax actually paid by a controlled foreign company in the relevant tax (reporting) period, proportional to the share of the controlling entity in such foreign controlled company reflected in the report on controlled foreign companies.
However, the amount of such reduction may not exceed the amount of tax liability of the legal entity in respect of the profits of such controlled company.
* The norm of § 137.9 of the TCU, enters into force on 01.01.2021
14. The cost threshold for the attribution of tangible assets to fixed assets increased to 20 thousand UAH. (previously it was UAH 6,000) and the expected service life is over a year (operating cycle is longer than 1 year). This applies to new fixed assets.
15. The calculation of depreciation of fixed assets and intangible assets is carried out in accordance with UAS or IFRS for all methods of depreciation (previously the production method was not used in tax accounting). It is also determined that depreciation is not accrued in the period of non-use (operation) of fixed assets in economic activities in connection with their modernization, reconstruction, completion, equipment and conservation (added the third paragraph of paragraph 138.3.1 TCU).
15.1. for the purposes of calculating the difference by which the pre-tax financial result is increased in accordance with paragraph 140.2 of the TCU, the taxpayer is required to keep separate records of interest that have been capitalized (subject to inclusion in the cost of non-current assets) in accordance with UAS or IFRS;
15.1. the minimum allowable depreciation period is still applied to fixed assets (hereinafter – OZ) and other non-current assets (except for the application of the production method of depreciation) (new version of the first paragraph of paragraph 138.3.3 TCU).
16. It is stated in the new edition of item 139.2 of TCU. It will now determine the provision for doubtful debts or the provision for expected credit losses (impairment of assets).
17. The accounting of debt obligations under item 140.2 of TCU changes, this norm is effective from 01.01.2021.
If the amount of debt arising from transactions with non-residents exceeds the amount of equity more than 3.5 times, the pre-tax financial result is increased by the amount of excess accrued interest on loans, borrowings, etc. (except for interest subject to capitalization) until the commissioning of the relevant asset) more than 30% of the amount of the calculated object of income tax for the reporting (tax) period in which such interest is accrued, increased by the amount of financial expenses according to the financial statements and the amount of depreciation according to tax reporting of the same tax (reporting) period. However, this rule will not apply to interest that does not comply with the principle of “outstretched hand” under Art. 39 TCU.
18. The increase (decrease) in the pre-tax financial result is set out in a new wording. The pre-tax financial result increases:
18.1. for the amount of costs of recognized fines, penalties, penalties, damages, etc. (paragraph 140.5.11 TCU).
18.2. in the amount of 30% of the value of goods, including non-current assets, works, services (except for controlled transactions in accordance with Article 39 of the TCU), sold in favor of separately defined TCU non-residents (paragraph 140.5.51 TCU);
18.3 for the amount of expenses incurred by the taxpayer in carrying out transactions with non-residents, if such transactions have no business purpose. In this case, the obligation to prove such absence rests with the State Tax Service (paragraph 140.5.15 of the TCU). However, the payment of mandatory fees by the bank, as well as the payment of other payments by taxpayers, which are mandatory for professional activities, will not increase the pre-tax financial result (paragraph 140.5.9 of the TCU).