LAW OF UKRAINE

of December 7, 2017 No. 2245-VIII

About introduction of amendments to the Tax Code of Ukraine and some legal acts of Ukraine concerning ensuring balance of budget receipts in 2018

List of amending documents

The Verkhovna Rada of Ukraine decides:

I. Bring in the Tax code of Ukraine (Sheets of the Verkhovna Rada of Ukraine, 2011, Art. No. No. 13-17, 112) the following changes:

1. In Article 12:

Subitem 12.3.3 of Item 12.3 to state 1) in the following edition:

"12.3.3. The copy of the made decision on establishment of the local taxes or charges or on modification of them goes in electronic form to ten-day time from the date of acceptance in monitoring body in which payers of the corresponding local taxes and charges, but no later than July 1 of the year preceding budget period in which application of the established local taxes and charges or changes to them is planned stay on the registry.

Monitoring bodies no later than July 10 of the current year constitute summary information on the size and date of establishment of rates of the local taxes and charges in the corresponding territories and represent it electronically to the central executive body realizing the state tax and customs policy.

The central executive body realizing the state tax and customs policy no later than July 15 of the current year publishes on the official website summary information on the size and date of establishment of rates of the local taxes and charges in the corresponding territories.

The local government body in ten-day time from the date of approval of technical documentation on normative money value of lands sends electronically to monitoring body information on normative money value of lands.

Monitoring bodies no later than July 10 of the current year constitute summary information on normative money value of lands.

The central executive body realizing the state tax and customs policy no later than July 15 of the current year publishes on the official website summary information on the carried-out normative money value of lands";

Item 12.5 to add 2) with the paragraph the second the following content:

"Payers of the local taxes and charges in case of determination of the tax liabilities can use the summary information posted on the official website of the central executive body which realizes the state tax and customs policy. Such payers are exempted from liability if in the summary information posted on the official website the mistake containing discrepancies between data of monitoring bodies and data officially of the promulgated decision on establishment of the local taxes and charges is revealed. In that case the penalties and penalty fee provided by this Code for violation of tax and other legislation, control of which observance is imposed on the monitoring bodies caused by such mistake, are not applied to such taxpayers, there are no bases for involvement of the taxpayer and/or his officials to responsibility".

2. In Item 14.1 of Article 14:

Subitem 14.1.5 after figures "2206" to add 1) with words "(except kvass of "live" fermentation)";

The subitem "g" of subitem 14.1.11 to exclude 2);

Subitem 14.1.24 to state 3) in the following edition:

"14.1.24. The large taxpayer - the legal entity or permanent mission of the nonresident in the territory of Ukraine in which the amount of the income from all types of activity for the last four consecutive tax (reporting) quarters is exceeded by the equivalent of 50 million euros determined by the weighted official rate of the National Bank of Ukraine for the same period or total amount of taxes, charges, the payments paid to the Government budget of Ukraine, control of which collection is imposed on monitoring bodies, for the same period exceeds the equivalent of 1 million euros determined by the weighted official rate of the National Bank of Ukraine for the same period if the amount of such taxes, charges, payments, except customs payments, exceeds equivalent of 500 thousand euros";

To add 4) with subitems 14.1.60-2 and 14.1.124-1 of the following content:

"14.1.60-2. Total amount of the tax liabilities on the excise tax on cigarettes - the annual amount of the tax liabilities on the excise tax of all payers of the excise tax from goods by codes according to UKT foreign trade activities 2402 20 90 10, 2402 20 90 20 Ukraine realized by producers on customs area and imported by importers on customs area of Ukraine, determined in declarations of the excise tax for January - December of accounting year, per 1000 pieces.

The central executive body realizing the state tax and customs policy determines by data of declarations of the excise tax and publishes on the official website no later than March 1 of the year following for reporting, the total amount of the tax liabilities on the excise tax on cigarettes, the weighted retail price of sale of cigarettes and the indicator (as a percentage) characterizing share of total amount of the tax liabilities on the excise tax in the weighted retail price of sale of cigarettes. (5 *)

The share of total amount of the tax liabilities on the excise tax in the weighted retail price of sale of cigarettes is calculated by the following formula:

 

where It is frequent. - share of total amount of the tax liabilities in the weighted retail price of sale of cigarettes; 

Price средн.взвеш. - weighted retail price of sale of cigarettes;

Amount tax. обяз. - total amount of the tax liabilities on the excise tax on cigarettes";

"14.1.124-1 new well (for the purpose of realization of provisions of the Section IX of this Code) - well which drilling is begun from ground land surface (level of zero meters according to the project of well) after January 1, 2018 that is confirmed by the act of putting into operation of the drilling rig";

5) in subitem 14.1.159:

to add the subitem "an" after the paragraph of the eighth with two new paragraphs of the following content:

"Final beneficial owner (controller) of such legal entities is the same physical person;

powers of sole executive body of such legal entities are performed by the same person".

With respect thereto the ninth to consider the paragraph the paragraph the eleventh;

the eleventh to add the paragraph with the offer of the following content: "Provisions of this paragraph do not extend to the amount of the credits (loans) attracted under the state guarantees";

to add the subitem "b" after the paragraph of the fifth with the new paragraph of the following content:

"The physical person is final beneficial owner (controller) of the legal entity".

With respect thereto to consider the paragraph of the sixth the paragraph the seventh;

in the subitem "v":

after the paragraph of the seventh to add with the new paragraph of the following content:

"If the physical person is recognized connected with other persons according to this subitem, such persons are recognized connected among themselves".

With respect thereto paragraphs of the eighth - to consider the fourteenth respectively paragraphs the ninth - the fifteenth;

in the paragraph the twelfth the word and figures "exceeds 20" shall be replaced with words and in figures "constitutes 20 and more";

in the paragraph the fifteenth to replace the word "practical" with the word "actual";

Subitem 14.1.225 to state 6) in the following edition:

"14.1.225. Royalty - any payment received as remuneration for use or for provision of the right to use object of intellectual property right, namely on any literary works, arts or sciences, including computer programs, other records on data carriers, video or audio cassettes, cinema movies or films for radio - or television broadcasting, transfer (program) of the organizations of broadcasting, other audiovisual works, any rights protected by the patent, any registered trademarks (signs on goods and services) intellectual property rights on design, confidential drawings, models, formulas, process, intellectual property rights on information of rather industrial, commercial or scientific experience (know-how).

Royalty the payments received are not considered:

as remuneration for use of the computer program if conditions of use are limited to functional purpose of such program and its reproduction is limited the number of the copies necessary for such use (use by "final consumer");

for acquisition of copies (copies, copies) of intellectual property items, including electronically, for use on the functional purpose for final consumption or for resale of such copy (the copy, copy);

for acquisition of things (including data carriers) in which are realized or on which there are objects of intellectual property right, determined in paragraph one of this subitem, in use, ownership and/or the order of person;

for assignment of rights on objects of intellectual property right if conditions of assignment of rights on object of intellectual property right grant the right to person acquiring such rights to sell or perform alienation otherwise of intellectual property right or to promulgate (to divulge) confidential drawings, models, formulas, processes, intellectual property rights on information of rather industrial, commercial or scientific experience (know-how), except cases when such promulgation (disclosure) is obligatory according to the legislation of Ukraine;

for transfer of the right to distribution of copies of program products without the right to their reproduction or if their reproduction is limited to use by the final consumer";

To add 7) with subitems 14.1.227-1 - and 14.1.227-2 - the following content:

"14.1.227-1. The weighted retail price of sale of cigarettes - the price calculated from the amount of total cost of all cigarettes realized by producers on customs area of Ukraine and imported by importers on customs area of Ukraine from January 1 till December 31 of accounting year divided into the amount of total quantity of the cigarettes realized by producers and imported by importers for the same period determined in declarations of the excise tax for January - December of accounting year, per 1000 pieces.

14.1.227-2. Syndicated financial loan - the means provided by several resident banks and/or nonresident banks, or the nonresidents qualified as bank institution according to the legislation of adoptive state of the nonresident, or the residents and/or nonresidents having the status of non-bank financial institutions according to the relevant legislation and also foreign state or its official agencies, international financial institutions and other nonresident creditors (members of syndicate of creditors) within one credit agreement in certain shares to legal entities for certain term for target use and under percent. Payment of the income to members of syndicate of creditors can be performed through the agent, the nominee holder (nominee holder) or the intermediary in it of the income";

8) in subitem 14.1.266 of the word of "emergence of the right to the tax credit" shall be replaced with words "reference of tax amounts to the tax credit";

To add 9) with subitem 14.1.272 of the following content:

"14.1.272. Kvass of "live" fermentation - the drink with content of ethyl alcohol of no more 1,2 of percent of volume units received during fermentation of kvass must belongs to goods items of 2202 and 2206 according to UKT foreign trade activities".

3. To state subitem 20.1.40-1 of Item 20.1 of Article 20 in the following edition:

"20.1.40-1. take a legal action concerning recognition of persons connected on the basis of the facts and circumstances that one person exercised the actual control of business solutions of other legal entity and/or that the same physical person or legal entity exercised the actual control of business solutions of each legal entity".

4. In Article 21:

Shall be replaced with words 1) in the name of the word of "officials" "official and officials";

In paragraph one of Item 21.1 of the word "Officials" shall be replaced with words 2) "Official and officials";

Item 21.3 to state 3) in the following edition:

"21.3. The damage caused to the taxpayer by illegal decisions, actions or failure to act official or the official of monitoring body, is compensated at the expense of the means of the government budget provided for financing of this body irrespective of fault of this person";

To add 4) with Item 21.4 of the following content:

"21.4. Official or the official of monitoring body bears before the state responsibility according to the procedure of regress in the amount of compensation for illegal decisions, actions paid from the budget or failure to act of this official (office) person".

5. In Article 39:

1) in Item 39.2:

in subitem 39.2.1:

in subitem 39.2.1.1:

add the subitem "g" with the paragraph the second the following content:

"In case of modification of the list of forms of business of nonresidents by the states (territories) approved by the Cabinet of Ministers of Ukraine according to this subitem they become effective since January 1 of the accounting year following after calendar year in which such changes are made";

add with the subitem "g"" the following content:

"") the economic activities performed between the nonresident and his permanent mission in Ukraine";

state subitem 39.2.1.2 in the following edition:

"39.2.1.2. In case of determination of the list of the states (territories) for the purposes of the subitem "in" subitem 39.2.1.1 of this subitem the Cabinet of Ministers of Ukraine considers the following criteria:

the states (territory) in which the rate of the income tax of the companies (corporate tax) on 5 and more percent points is lower, than in Ukraine or which provide to subjects of managing the preferential tax treatments or to whom features of calculation of taxation basis actually allow subjects of managing not to pay the income tax of the companies (corporate tax) or to pay it at the rate on 5 and more percent points below, than in Ukraine;

the states with which Ukraine does not sign the international agreements with regulations on exchange of information;

the states which competent authorities do not provide timely and global exchange with tax and financial information on requests of the central executive body realizing the state tax and customs policy.

Are recognized to the transaction with the partner registered in the state (in the territory) included in the specified list controlled since January 1 of the accounting year following after calendar year in which the states (territory) were included in this list";

add subitem 39.2.1.4 with the paragraph the seventh the following content:

"The transactions performed between the nonresident and his permanent mission in Ukraine";

state subitems 39.2.1.5 and 39.2.1.7 in the following edition:

"39.2.1.5. If in chains of economic activities between the taxpayer and his connected person - the nonresident, provided by subitem 39.2.1.1 of this subitem, the property right regarding (result) of such transaction before passing from the taxpayer to such nonresident (in case of export transactions) or before passing from such nonresident to the taxpayer (in case of import transactions) passes to one or several persons, such transaction for the purposes of the taxation the income tax of the companies is considered the controlled transaction between the taxpayer and such nonresident if these persons:

do not carry out in such set of transactions of the essential functions connected with acquisition (sale) of goods (works, services) between the connected persons;

do not use in such set of transactions of essential assets and/or do not assume substantial risks for the organization of acquisition (sale) of goods (works, services) between the connected persons.

For the purposes of this subitem:

essential functions and assets are understood as functions which the connected persons could not execute independently in the regular activities without involvement of other persons and use of assets of such persons;

essential assets are understood as assets which use is necessary when implementing such transactions and which are absent at the connected persons;

substantial risks are understood as risks which acceptance is obligatory for business practice of such transactions";

"39.2.1.7. The economic activities provided by subitems 39.2.1.1 (except the transactions performed between the nonresident and his permanent mission in Ukraine) and 39.2.1.5 these subitems, are recognized controlled if the following conditions are at the same time satisfied:

the annual earnings of the taxpayer from any activities determined by accounting rules exceed 150 million hryvnias (less indirect taxes) for the corresponding tax (reporting) year;

the amount of such economic activities of the taxpayer with each partner determined by accounting rules exceeds 10 million hryvnias (less indirect taxes) for the corresponding tax (reporting) year.

The economic activities performed between the nonresident and his permanent mission in Ukraine are recognized controlled if the amount of such economic activities determined by accounting rules exceeds 10 million hryvnias (less indirect taxes) for the corresponding tax (reporting) year";

add with subitem 39.2.1.9 of the following content:

"39.2.1.9. The amount of economic activities of the taxpayer for the purposes of subitem 39.2.1.7 of this subitem is calculated at the prices corresponding to the principle of" outstretched arm";

in paragraph seven of subitem 39.2.2.2 of subitem 39.2.2 to exclude the word "comparable";

2) in Item 39.3:

to state paragraphs of the first and second of subitem 39.3.2.9 of subitem 39.3.2 in the following edition:

"39.3.2.9. Information of rather comparable legal entities for calculation of the financial performance specified in subitem 39.3.2.5 of this subitem is used in case of simultaneous observance of the following conditions:

1) if the comparable legal entity performs the activities comparable to activities of the party of the controlled transaction which are researched, and performs the comparable functions connected with such activities. Comparison of activities is determined, in particular, but not only, taking into account types of economic activity according to KVED of recreation center 009: 2010, and also international qualifiers";

to add subitem 39.3.3.3 of subitem 39.3.3 with the paragraph third the following content:

"The form of the notification and procedure for its representation affirm the central executive body which provides forming and realizes the state financial policy";

3) in Item 39.4:

subitem 39.4.2 in paragraph six "subitem 120.3" shall be replaced with words the word and figures also in figures "subitems 120.3 and 120.4";

state subitem 39.4.5 in the following edition:

"39.4.5. The inquiry is sent not earlier than October 1 of the year following after calendar year in which such controlled transaction (transactions) was performed";

in subitem 39.4.6:

the paragraph one and subitems "a", "b" and "v" to state in the following edition:

"39.4.6. Documentation on transfer pricing (set of documents or the single document constituted in any form) shall contain the following information:

a) data on face (persons) which is the party of controlled transaction and on the connected faces of the taxpayer (in the accounting period in which controlled transaction, and at the time of submission of documentation was performed), namely:

partner (partners) of controlled transaction;

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