Analysis of Law 466-IX: How the “Small Tax Reform” Changed the Game for VAT

 

Amendments to the Tax Code of Ukraine (TCU), introduced by Law 466-IX, were once dubbed the “small tax reform”. Even in 2026, these norms remain the foundation of modern taxation in Ukraine. Understanding these provisions is critical for businesses dealing with foreign assets and complex ownership structures.

Lawyers at Law Business Association (LBA) have prepared an updated analysis of the key provisions of Law 466-IX that transformed the rules for taxpayers in the VAT sphere.

VAT Registration: New Deadlines and Digitalization

Law 466-IX significantly changed the procedural aspects of business interaction with tax authorities. The main emphasis was placed on accelerating deadlines and transitioning to an exclusively electronic format.

Key updates according to Art. 183 of the TCU:

• Voluntary Registration: The registration application must now be submitted no later than 10 calendar days before the start of the tax period (previously, the deadline was 20 days).
• Simplified System: For Group 3 Single Tax payers (non-VAT payers), when changing the rate, the application deadline is also reduced to 10 days before the start of the month in which the new rate applies.
• Electronic Format: Registration applications are submitted exclusively in electronic form. Paper versions are no longer provided for.

For newly created business entities, the option to submit an application to the state registrar together with the business incorporation documents remains available. Consideration of such an application by the controlling body takes 3 working days.

Determination of the VAT Tax Base

Article 188 of the TCU, as amended by Law 466-IX, clearly regulates the rules for determining the base for specific operations, minimizing the room for interpretation by tax officials.

Export Operations and the Electricity Market

For operations involving the export of goods outside the customs territory of Ukraine, the tax base is the contractual value fixed in the customs declaration. Special attention is paid to the energy sector: when supplying electricity, the base is determined by the market price, even if it is lower than the purchase price, which eliminates the need for artificial accrual of liabilities.

New Rules for Tax Credit Formation

Amendments to Article 198 of the TCU expanded opportunities for payers regarding the confirmation and formation of tax credit.

• Customs Declarations: VAT amounts confirmed by temporary and supplementary customs declarations are now officially included in the tax credit.
• Cash Method: If payment for goods/services occurs after 1095 days, payers have the right to a credit in the payment period, but no later than 60 days from the payment date.

Electronic Administration and Registration Limit

The reform affected the algorithms for calculating the registration limit in the SEA VAT (System of Electronic Administration of VAT) (Art. 200-1 of the TCU). Now, the formula takes into account funds seized by the tax authority to pay off tax debt for declared liabilities, starting from periods after July 1, 2015.

Tax Invoice Deadlines and Reporting

Law 466-IX made concessions to business regarding the registration deadlines for compensating tax invoices. This allows accountants to better process large amounts of data at the end of the reporting period.

• Consolidated Tax Invoices and Adjustment Calculations: For operations under para. 198.5 and para. 199.1 of the TCU, the registration deadline has been extended from the 15th to the 20th of the month.
• Period Unification: A single reporting period has been established — the calendar month. Quarterly reporting for Single Tax payers has been abolished.

Temporary and Restored VAT Exemptions

In addition to procedural changes, the law introduced several preferential regimes for strategically important areas.

In particular, exemptions were established for the transfer of vehicles to special purpose bodies and low-income population groups. An important step for the agricultural sector was the restoration of the zero VAT rate for the export of soybeans and rapeseed, which again allowed exporters to claim budget reimbursement.

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About the Author:

Denys Fedorkin — Managing Partner of the law firm Law Business Association (LBA). A lawyer with over 17 years of experience in business protection, a specialist in tax law and anti-raider activities.

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