Legal Hotline | Digest of the main legislative changes in Ukraine 10.12.2020

The law on writing off debts of the business and introducing “tax holidays” was adopted

On December 4, the Verkhovna Rada of Ukraine adopted Law No. 4430 (1072-IX) aiming at supporting the taxpayers during the quarantine, encouraging the taxpayers to diligently pay monetary (tax) liabilities and avoiding the occurrence (increase) of tax debts.

The Law prescribes the following provisions, inter alia:

• writing off the tax debts of taxpayers unless the total amount of taxpayer’s debts under all taxes and duties exceeds UAH 3 060 and it is not paid as of November 01, 2020;
• writing off the fine  and penalties in case the taxpayers pay at their own the tax debts upon the main payment within 6 months after the Law becomes effective (except for certain cases determined by this Law);
• increasing the threshold amount of tax debts to UAH 3 060 for applying measures regarding its collection ;
• releasing the I group single tax payers from paying the single tax for December 2020 and January-May 2021;

The Law also provides for other guarantees and opportunities for taxpayers. The document has been recently signed by the President and will be published soon.

The law on supporting the business during quarantine was adopted

On December 4, the Verkhovna Rada adopted Law No. 4429 (1071-IX) “On social support to insured persons and business entities for the period of duration of restrictive anti-epidemic measures introduced in order to prevent the spread in Ukraine of acute respiratory disease COVID-19 caused by coronavirus SARS-Co V-2”.

The Law provides for ensuring the payment of one-off financial aid in the amount of UAH 8 000 to insured persons who may lose a part of salary or income in case of introducing additional quarantine measures, as well one-off financial aid to business entities in the amount of up to UAH 8 000 per one employee in order to retain positions of employees, and one-off compensation to business entities for expenses incurred because of paying the  mandatory state social insurance single contribution. The respective  payments from the State Budget of Ukraine are anticipated in 2020-2021.

Furthermore, the validity of state and municipal property lease agreements which expire  during the quarantine or restrictive measures period have been extended for business entities, the operation of which has been temporarily suspended because of the introduction of quarantine measures. The respective provision shall remain in force for the period of quarantine or restrictive measures and within one month after the end thereof.

Moreover, the Law cancels the charge of rent under state and municipal property lease agreements for the period of quarantine for business entities, the operation of which has been prohibited during the specified period.

The respective document shall become effective on the day following the day of its publishing.

Application of cash registers for certain individual entrepreneurs to be postponed

The Verkhovna Rada of Ukraine adopted Law No. 4439д (1017-IX) amending thereby the Tax Code of Ukraine and other laws of Ukraine by postponing until January 1, 2022, the mandatory application of cash registers for individual entrepreneurs who are the II-IV group single tax payers and whose income amount during the calendar year does not exceed the threshold income amount set for the I group single tax payers, except for those who carry out the activity in spheres with significant tax evasion risks.

In addition, the Law provides for cancellation of penalties for non-compliance of the cash funds at the place of payments with the amount of funds specified in a daily cash register report. Penalties shall also be cancelled in case of the absence of pre-programming of goods in the cash register.

The Law extends the application of reduced amounts of financial penalties for violation by business entities of certain requirements of the law on using the cash registers when conducting payment transactions until January 1, 2022.

The Law also determines the threshold income amounts, not exceeding of which is one of the conditions for applying by the entities of the simplified taxation system for relevant single tax payer groups based on the minimum salary amounts set by the law.

The document has been recently signed by the President and will be published soon. The Law shall become effective on the day following the day of its publishing, except for sections I of this Law, which shall become effective from January 1, 2021.

Liability for false declaration in Ukraine was restored

The Verkhovna Rada of Ukraine adopted Law No. 4460-д on restoring the liability for declaring false information and deliberate failure to submit a declaration by a subject of declaration.

Article 366-1 was excluded from the Criminal Code of Ukraine and a new Article 366-2 was included in the Code. The new Article sets forth criminal liability for declaring information, that differs from the reliable in the amount from 500 to 4,000 minimum subsistence levels for able-bodied persons in the form of a penalty or community service with the deprivation of the right to occupy certain positions or carry out the certain activity for up to three years.

If a subject of declaration declared information, that differs from the reliable, in the amount  exceeding 4,000 minimum subsistence levels for able-bodied persons, liability in the form of a penalty or imprisonment for up to two years with the deprivation of the right to occupy certain positions or carry out the certain activity for up to three years shall be established.

Furthermore, the Criminal Code of Ukraine was supplemented with Article 366-3, which provides for criminal liability for the deliberate failure of a subject of declaration to submit a declaration of a person authorized to perform functions of the state or local self-government bodies in the form of a penalty or community service with the deprivation of the right to occupy certain positions or carry out a certain activity.

The Law is currently pending signature by the President of Ukraine.