TAX ALERT 19.03.2025 | Digest of Key Tax News

Zero customs clearance of vehicles for specific categories of persons is suggested

On March 03, 2025, the Verkhovna Rada of Ukraine registered draft laws:

• No. 13058 “On Amendments to the Customs Code of Ukraine on Zero Customs Clearance of Vehicles for Combatants Who Were Injured as a Result of Participation in Measures to Repel and Deter Military Aggression against Ukraine”;
• No. 13059 “On Amendments to the Tax Code of Ukraine on Zero Customs Clearance of Vehicles for Combatants Who Were Injured as a Result of Participation in Measures to Repel and Deter Military Aggression against Ukraine”.

These draft laws suggest, for the period of martial law in Ukraine and until December 31 of the year following the year in which it is terminated, the exemption from VAT, excise tax, and import duty on operations of import of passenger cars, car bodies, trailers and semi-trailers, motorcycles, vehicles designed to carry 10 persons or more, freight vehicles, that are carried out by the individuals:

• who have the status of a person with a disability as a result of war; are combatants who were injured as a result of participation in measures to ensure national security and defense, repulse and deter military aggression against Ukraine; or by officially authorized representatives of such persons;
• who have officially transferred their own vehicle to a military unit participating in measures to repel and deter military aggression against Ukraine.

Under these conditions, the above-mentioned categories of individuals will be able to import one vehicle into Ukraine, except for those originating from the occupying and/or aggressor state or imported from the territory of such states and/or the occupied territories of Ukraine.

Draft law on the introduction of international automatic exchange of information on income received through digital platforms is published

On March 07, 2025, the draft law “On Amendments to the Tax Code of Ukraine and Other Legislative Acts on the Implementation of the International Automatic Exchange of Information on Income Received through Digital Platforms” was published on the official website of the Ministry of Finance of Ukraine.

As stated in the explanatory note, the draft law is aimed at implementing the provisions of the OECD Model Reporting Rules for Digital Platforms to ensure the framework for the State Tax Service of Ukraine (hereinafter the “STS of Ukraine”) to join the Multilateral Competent Authority Agreement on Automatic Exchange of Information on Income Derived through Digital Platforms (hereinafter the “DPI-MCAA”).

The draft law, inter alia, suggests the following:

1. Introduction of the international automatic exchange of information on income received by individuals and organizations through digital platforms, which will be carried out by the STS of Ukraine with the competent authorities of foreign jurisdictions in accordance with the DPI-MCAA.
2. Determining the basic requirements for the identification of reporting sellers by digital platform reporting operators and the submission of reports on their income.

Any of the following activities carried out by a seller through a digital platform for remuneration will be considered a reporting activity for the purposes of submitting such reports:

• leasing of real estate, vehicles;
• sale of goods;
• personal services, which will mean services (including work) provided (performed) within a certain time at the request of the user and through the online platform or virtually.

The category of reporting sellers will include sellers who are residents of Ukraine and residents of any jurisdiction that is a party to the DPI-MCAA.

3. Personal income taxation at the rate of 5 % of the income of an individual, who will be considered a reporting seller, from reporting activities through digital platforms, provided that such person is a resident of Ukraine, has reached the age of 18 and meets the following requirements:

• has a current account in a bank of Ukraine for payments in the course of reporting activities and notifies the reporting platform operator of its details;
• makes payments exclusively in monetary form using a current account;
• has not been subject to any sanctions in accordance with the Law of Ukraine “On Sanctions”;
• is not a self-employed person and does not use the labor of employees;
• the annual income from the reporting activities is up to UAH 5 million;
• does not sell excisable goods.

At the same time, the tax agent of such a taxpayer will be the reporting operator of the digital platform, which will accrue (calculate) and pay income to said taxpayer.

4. For the purposes of the international automatic exchange of information in accordance with the DPI-MCAA, it is suggested to set the first reporting period to be from January 01, 2026, to December 31, 2026, inclusive. It is also envisaged that in 2027 the deadline for submission of the report on income of reporting sellers for the first reporting period will be set, but not earlier than February 01, 2027.

The STS updated the directory of tax information codes for the purposes of determining the riskiness of a taxpayer

On the official website of the STS of Ukraine, order No. 195, dated March 5, 2025, “On Amendments to Order of the STS of Ukraine dated January 11, 2023, No. 17” was published, which, in particular, approved an updated directory of tax information codes (hereinafter the “Codes Directory”), which became the basis for considering whether a VAT payer meets the criteria of a risky taxpayer.

The Codes Directory has been supplemented with codes of the following tax information, which is the basis for considering compliance with the riskiness criteria:

• formation of the registration limit through transactions for the purchase of works and services in significant volumes in the absence of objective conditions (opportunities) for their use in business activities;
• reflection in tax reports of a taxpayer (except for the manufacturers) of income accrued and paid to self-employed persons who do not have the necessary objects of taxation and the number of labor resources required to carry out financial and economical operations in the amounts reflected in the taxpayer’s tax reports;
• submission for registration of a tax invoice / adjustment calculation (hereinafter the “TI / AC”) for the purpose of exporting goods subject to the export security regime, the origin of which cannot be traced back to the chain of purchase, and the taxpayer is not the producer of such goods;
• information is available on the inability to conduct a documentary on-site audit due to the absence of a taxpayer (taxpayer’s officials or legal representatives) at the tax address and/or place of business conduct.

It has been specified that transactions with counterparties in respect of which a decision on compliance with the riskiness criteria has been made, will be the basis for considering the taxpayer’s compliance with the riskiness criteria, provided that the date of submission of the TI / AC for registration of the relevant transactions falls after the date of the decision on compliance with the riskiness criteria in respect of such counterparty.

Also, two codes of tax information related to the application of special economic and other restrictive measures (sanctions) to the taxpayer or founders / officials were removed from the Codes Directory.

The position of the Supreme Court on confirmation of force majeure in case of violation of deadlines for payments in the field of foreign economic activity

In its ruling dated February 27, 2025, in case No. 520/2941/24, the Supreme Court set out a legal opinion on the procedure for confirming the force majeure that affected the violation of the deadlines for payments under a foreign economic contract and which is the basis for terminating the accrual of penalties for such violation.

In particular, during the proceedings the company emphasized that it was unable to fulfill its obligation to return foreign currency earnings under a contract with a non-resident due to the force majeure, namely, the destruction of primary documents due to shelling of their storage facilities. To confirm the fact of its occurrence, the court was provided with certificates from the Chamber of Commerce and Industry.

The courts of first instance and appeal concluded that the force majeure was proved by the certificates and the tax notice decision on penalty was canceled.

However, the Supreme Court found such a conclusion incorrect and noted that the certificate of the Chamber of Commerce and Industry cannot be considered an indisputable evidence of the inability to fulfill an obligation, but should be critically evaluated by the court taking into account the nature of the obligation.

The Supreme Court concluded that the company:

• failed to prove the existence of a causal link between the non-resident’s failure to fulfill its obligation to timely pay for the delivered goods and force majeure;
• did not provide the court with a certificate from the authorized body of the non-resident’s country of location or a third country confirming the occurrence and termination of force majeure that made it impossible to properly make payments under the contract.

Given the above, the decisions of the court of previous instances were canceled, and the company’s claim was dismissed.